The economy rebounded strongly
House prices have soared relative to incomes
Public debt will rise in the long run
New Zealand’s initial response to COVID-19 infection was exceptionally swift
The declines in GDP per capita and labour productivity relative to US levels have been attenuated by terms-of-trade gains
New Zealand’s service sector is large, as in other countries, but agriculture is larger and manufacturing smaller than elsewhere
The largest export categories are agriculture and tourism and the largest export markets China and Australia
New Zealand's export intensity is low for a small country
New Zealand is not well integrated in global value chains
Greenhouse gas emissions growth and per capita levels are high
The economy bounced back quickly from the pandemic-induced contraction
The vaccination rate is above the OECD average
New Zealand’s intensive care unit capacity is low
House prices and residential investment have increased
Business opinion points to solid economic growth and business investment
Robust commodity demand has boosted the economy but tourism has been hit by the pandemic
The current account deficit has returned to the pre-COVID-19 level and the net international investment position remains low by international comparison
The labour market is tight
Inflation has increased
Cyclical inflation has increased since the onset of the COVID-19 recession, in contrast to declines in past recessions
Asset price correction is a major macro-financial risk
Household indebtedness is high
Mortgage lending has accelerated, including more high-risk lending
Proposed new capital requirements exceed those in other OECD economies
The number of bankruptcies remains low for now
The proposed deposit insurance coverage is relatively low
Reforms are needed to prevent population-ageing fiscal pressures from pushing up government debt
The weight of procurement in fiscal spending is relatively large
New Zealand performed well on several OECD How’s Life indicators before the pandemic
Income inequality is above the OECD average and child poverty is high
Reduction in child poverty progressed toward the targets before the COVID-19 shock
The labour tax wedge is among the lowest in the OECD
Productivity growth slowed down
Regulatory barriers to competition are low overall but state ownership is high
The corporate tax rate is high, especially compared with other small advanced economies
The inward FDI stock is small for a small open economy
Employment protection legislation is less strict in New Zealand than in many other OECD countries
Real house prices have increased more than in other OECD countries
Housing affordability is low
The share of social housing is low and public expenditure on housing allowances is high
New housing supply ran behind demographic demand in the years preceding the pandemic
Debt servicing costs for new buyers would be much higher at neutral interest rates
It will take many years for the median house price-to-income ratio to return to the pre-COVID level if house prices do not fall
The agricultural sector accounts for a large share of GHG emissions in New Zealand
New Zealand is not on track to meet its GHG abatement objectives
Environmental taxation is limited compared to other OECD economies
Corruption is very low
Tax transparency is high and anti-money laundering is relatively effective
ICT industries account for a low share of value added
Labour productivity has grown fast in the ICT sector
Shortages of ICT skills are among the most pronounced in New Zealand, 2015
Wages in the digital sector are relatively high
Overall, New Zealand scores around the OECD average on the available digital indicators
The contribution of digital-intensive sectors to employment growth is around the OECD average
New Zealand makes little use of digital inputs in its production
Few New Zealand firms are successful in achieving transformative outcomes using ICT
Large firms were not much better than smaller firms in expanding online sales during the pandemic
Growth in agricultural output is driven less by innovation and more by growth in primary factor input
Exports of predominantly digitally deliverable services are relatively low in New Zealand
Smaller firms are more likely to export online than via traditional channels
Exporters use digital tools more intensively
New Zealand is advanced in making government data open, useful and re-usable
New Zealand’s broadband speed is higher than the OECD average
The share of fibre connections in total fixed broadband is relatively high
Many of New Zealand’s schools are equipped with good digital tools
New Zealand has a high share of adults with a well-rounded skills set despite relatively weaker outcomes for the younger age group
New Zealand has a low share of adults lacking basic skills despite relatively weaker outcomes for the younger age group
New Zealand’s average PISA scores have declined
The share of high performers in PISA has declined and the share of low performers has increased
The influence of socio-economic background on PISA scores in literacy is greater than in many other countries
New Zealand primary and lower-secondary school students’ mathematics knowledge is poor
New Zealand lags behind in managerial practices
A relatively high share of businesses report ICT incidents (security breaches), 2019
The venture capital market is relatively large compared with the size of the economy