NZ ranks No. 5 in Forbes Magazine Best Countries for Business

Forbes Magazine analysed business climates in each of 127 national economies, focusing on degrees of trade freedom, monetary freedom like the right to participate in free and fair elections, or freedom of expression and organisation. The top countries were:

1. Denmark

2. USA

3. Canada

4. Singapore

5. New Zealand

6. United Kingdom

7. Sweden

8. Australia

9. Hong Kong

10. Norway

Forbes stated: Over the past 20 years the government has transformed NZ from an agrarian economy dependent on concessionary British market access to a more industrialised, free market economy that can compete globally. This dynamic growth has boosted real incomes - but left behind some at the bottom of the ladder - and broadened and deepened the technological capabilities of the industrial sector.

Per capita income has risen for nine consecutive years and reached $28,500 in 2008 in purchasing power parity terms. Debt-driven consumer spending drove robust growth in the first half of the decade, helping fuel a large balance of payments deficit that posed a challenge for economic managers. Inflationary pressures caused the central bank to raise its key rate steadily from Jan 2004 until it was among the highest in the OECD in 2007/08; international capital inflows attracted to the high rates further strengthened the currency and housing market, however, aggravating the current account deficit.

The economy fell into recession in 2008, and in line with global peers, the central bank has cut interest rates aggressively; the new government is responding with plans to raise productivity growth and develop infrastructure.