The economy of New Zealand is a highly developed free-market economy. The country has one of the most globalized economies and depends greatly on international trade – mainly with Australia, Canada, China, the European Union, Japan, Singapore, South Korea and the United States. The New Zealand dollar is the 10th-most traded currency in the world.
The following tables and chart will tell the change details in last 5-10 years:
New Zealand Distribution of workforce from the last 5 years:
New Zealand Distribution of GDP across economic sectors:
Here attached the last 10 years chart of New Zealand GDP: (amount in billion USD):
3 Sectors of the Economy – Agriculture, Industry and Services:
New Zealand is one of the world's largest exporters of dairy products as well as sheep meat. It employs 5.55% of the total work force of New Zealand and contributed almost 5.85% in the New Zealand's economy.
In New Zealand, agriculture is the largest sector of the tradable economy. The country exported NZ$46.4 billion worth of agricultural products (raw and manufactured) in 2019, 79.6% of the country's total exported goods.
Major products in this sector:
Dairy Farming: The dairy cattle farming industry employed 39,264 people as of the 2018 census, 1.6% of New Zealand's workforce, making it the country's tenth-largest employment industry. Only 3% of dairy production is consumed domestically, with the rest exported. New Zealand is the world's largest exporter of whole milk powder and butter, and the third-largest exporter (behind the European Union and the United States) of skim milk powder and cheese.
Sheep and Goat Meat: Sheep and goat meat exports are the second largest export market of New Zealand and account for 12.7% of its total annual exports. Australia and New Zealand compete for the prime position in this global export market, which is worth $7.94 billion annually. Australia controls 35.6% of the market, followed by New Zealand on 33.7%, with China in third place with 16.8%.
Agriculture Subsidy in New Zealand:
In 1984, New Zealand's government made the polemical economic decision to cut all subsidies to farmers, and instead use that money for agricultural research and development, also known as R&D.
Annually, about NZ$30 million from the government is invested into R&D to improve agriculture profitability and productivity. Agriculture R&D companies have arisen because of this funding. For example, Tru-Test, a New Zealand agtech company that invented a milk meter, is the world's largest supplier of the International Committee for Animal Recording. In addition, these public funds have led to the development of world-class agtech products such as the electric fence, livestock scales, and genomic selection technology.
Cutting subsidies and funding R&D boosted innovation which resulted in more efficient agricultural and pastoral farming methods. From 1984 to 2007, the agriculture sector's total productivity increased by an annual compound growth rate of 3.3 percent.
Industries plays an important part in the New Zealand's economy. It accounts for 20.43% of the GDP and employed almost 19.4 % of the workforce.
Major Industries in this sector:
Mining: New Zealand's mining sector contributes significantly to its economy. In the year ended March 2020, the gross domestic product (GDP) of the mining industry amounted to approximately 3.1 billion New Zealand dollars. Resources such as coal, iron ore, gold, and silver are mined by the thousands of people directly employed in that industry. Mining is a $3 billion industry and more than half of that, $1.5 billion earns export dollars for New Zealand. In 2019 the largest goods export to Australia was gold. ** Other exports include coking coal, iron sands and helyosite.
Construction: New Zealand's construction industry has seen continued growth over the past five years, contributing around 16.2 billion New Zealand dollars in gross domestic product (GDP) in 2020. Over 170,000 people work in the sector. These people account for 8 percent of the New Zealand workforce . The number employed in the sector has continued to grow despite the global financial crisis.
Service sector is a significant part in the New Zealand's economy. It contributes almost 65% in the GDP and employed almost 75% of the total New Zealand's workforce.
Major Industries in this sector:
Finance Sector: In 2019 financial sector contributed almost NZ $15 billion which is almost 65% of the total GDP of New Zealand. It employs almost 80,000 people in New Zealand. The increase in the sector's GDP makes the Financial Services industry the second fastest and third largest contributor to New Zealand's economic growth over the past 40 years.
Tourism: Tourism is the New Zealand's largest export industry and delivered $40.9 billion to the country. Tourism made a significant positive impact on regional economies supporting employment by directly employing 8.4 percent (229,566 people) of the New Zealand workforce. In 2019 3.8 million international tourists travelled in New Zealand and contributed almost $17.5 billion in New Zealand's Economy.
Top 10 Companies in New Zealand: (according to market cap)
|Company Name||Sector||Market Cap (USD)|
|Westpac Banking Corporation||Banking||60.604B|
|Fisher & Paykel Healthcare Corporation||Healthcare||13.65B|
|Auckland International Airport||Aviation||8.019B|
|The A2 Milk Company||FMCG||6.52B|
|Spark New Zealand||Communication||6.235B|
|Fonterra Co-operative Group||Dairy Products||5.084B|