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A STABLE, DEMOCRATIC SYSTEM OF GOVERNMENT
NZ is a parliamentary democracy with a single chamber House of Representatives. Members of Parliament are elected by a system of proportional representation. Everyone over the age of 18 has the right to vote in elections which are held by secret ballot, generally every three years.
The constitutional Head of State is Queen Elizabeth II, also Queen of Great Britain. She is represented by a Governor General. The current 120-member Parliament was elected in 1996 under a new Mixed Member Proportional system. This combines constituency seats and party or "list" votes to ensure each party in Parliament holds seats in proportion to the votes cast for it. This system is subject to a national referendum in 2002.
The Prime Minister is the leader of the majority party, or the leader of a coalition which commands a majority. He or she chooses ministers from among members of these parties. The ministers make up the Cabinet, the key decision making body of the government of the day. New Zealand enjoys a high degree of political stability, thanks in part to its long democratic traditions, in turn largely a legacy of the British tradition.
Governments are formed by moderate centre-right and centre-left left parties and have generally enjoyed tenures of at least two three year terms.
New Zealand has trade and political representation in 48 countries.
AN OPEN, INTERNATIONALLY COMPETITIVE ECONOMY
New Zealand is one of the world's most attractive business locations, offering an extensively deregulated, low cost and resource rich environment. Internationally, the World Economic Forum ranked New Zealand the fifth most competitive nation in the world in 1997. The open, internationally competitive economy is the result of a decade of far-reaching and comprehensive economic reform. This has transformed New Zealand into a world-class leader across many sectors including telecommunications, banking and financial services. For the future, the economy holds the promise of strong, consistent growth.
Key aspects of business in New Zealand:
 | a positive economy based on price stability and controlled government expenditure, tax reform, deregulation, privatisation of state enterprises, the removal of subsidies, lower trade barriers and labour market reform |
| minimal distortions and a lack of discrimination or corruption |
| a fair and low corporate tax system. |
Maori, New Zealand's indigenous people, play a significant role in economic development with access to an assett base conservatively valued at US$2.5 billion. They have contributed over US$200 million to New Zealand's global export drive, and many of their organisations are interested in attracting investment.
LOW TARIFS
Import licensing has been removed and tariffs are now the principal form of protection for New Zealand producers. Tariff rates on all imports have been phasing down since 1988. A further four year programme of tariff reductions applies from July 1997 to July 2000. Importers may obtain tariff relief by duty concessions if they can show that comparable goods are not manufactured or produced in New Zealand. All duties on goods between New Zealand and Australia ceased in 1990, under the Closer Economic Relations (CER) Agreement signed in 1983.
THE REGULATORY ENVIRONMENT: FOREIGN INVESTMENT
Minimal and transparent regulations make investing in New Zealand a straightforward process. New Zealand has a consistent and fair regulatory and political environment where overseas investors are treated on the same basis as domestic investors. In the 1996 global competitiveness report New Zealand was ranked fifth in the world for "receptivity towards foreign investment".
LEGAL SYSTEM AND MAJOR LAWS
New Zealand has a common law system, derived from the British system of justice.
There are four levels of courts:
| District Court |
| High Court of New Zealand (which has jurisdiction in respect of matters at first instance and on appeal from the District Court) |
| Court of Appeal (largely an appellate Court) |
| Judicial Committee of the Privy council (appellate jurisdiction only), sitting in London. |
In addition, there are a number of specific tribunals and bodies with jurisdiction in specialised areas such as resource management and employment law. New Zealand has a single legal profession in which most members hold a practising certificate as barrister and solicitor. Individuals may, however, elect to practise as barristers only or (rarely) solicitors only.
Queen's Counsel are appointed in a manner similar to the United Kingdom.
THE CENTRAL BANKING AUTHORITY
The Reserve Bank is New Zealand's central bank. Under a 1989 act of parliament, The Reserve Bank is charged with forming and implementing monetary policy that will promote price stability. To this end, it controls New Zealand's money supply (through its statutory function of printing and issuing currency).
The Reserve Bank's other main function is to license banks and to monitor currency trading through a system of returns which banks are required to file.
A COMMITMENT TO LOW INFLATION
The commitment of the central bank to price stability has helped produce a price stable, low-inflation environment. Over the last few years, the Reserve Bank has sought to achieve annual inflation rates of between 0 - 2%.
STOCK EXCHANGE
The New Zealand Stock Exchange offers a regulated market for trading in securities. This fosters a continuous auction process through brokers who own and have ultimate control of the Exchange. Various rules and regulations protect the interests of securities issuers, buyers, sellers and brokers, and facilitate the efficient operation of the market. These govern brokers' relationships with each other and with the Exchange, and impose contractual and location of buildings, landscaping, carparking and noise levels. Water use and discharges are controlled by regional plans. Regional coastal plans control the use of the marine area national plans include national policy and environmental statements.
A development may require a number of resource consents, including a land use consent, water permit for taking or diverting water. discharge permits or coastal permits. Resource consent applications are made first to district or regional councils, with the possibility of appealing to the Planning Tribunal. The Act is structured to ensure most applications are dealt with quickly.
FLEXIBLE INDUSTRIAL RELATIONS ENVIRONMENT
New Zealand's flexible and negotiable labour costs are among the lowest in the OECD. When adjusted for productivity they compare favourably with those in Asia. The Employment Contracts Act 1991 radically altered New Zealand's system of employment law and labour relations.
The main principles of the Act include freedom of association, free choice of representation in relation to bargaining over employment contracts, and the freedom of the parties to negotiate over a either a collective or an individual employment contract. The Act has introduced voluntary unionism and abolished monopoly union bargaining rights.
Personal grievance and disputes procedures must be included in every contract and can be enforced by a private adjudicator, Employment Tribunal or Employment Court. Strikes are only lawful when they relate to health and safety, or to the negotiation of a collective employment contract.
WORLD CLASS TRANSPORTATION INFRASTRUCTURE
New Zealand's experience in transportation has resulted in one of the world's most efficient, cost effective and up to date transportation structures. It has comprehensive shipping and air links to all parts of the world. About thirty international airlines offer direct air flights to major cities, and international shipping lines link New Zealand to Europe, North America, the Middle East, Asia, Australia and the Pacific. Fresh produce can be delivered the same day to locations including Asia and north America.
The transport sector is intensely competitive. Deregulation and the reform of publicly owned transport services have resulted in major efficiency gains. For example, New Zealand's ports can offer cost efficiencies and turnaround speeds that compare with best international practice. Internal road, rail, air and sea transport is also sophisticated and well established. Negotiable rates mean highly competitive transportation costs, from producer to market.
ADVANCED COMMUNICATIONS
New Zealand has a well developed technological and telecommunications system which facilitates access to a wide range of markets and ensures our integration with the global community.
PLENTIFUL, AFFORDABLE ENERGY
New Zealand enjoys abundant hydro-electric resources along with supplies of natural gas, oil and coal. A plentiful supply and a deregulated competitive environment have helped keep energy prices low.
TECHNOLOGY AND R&D
New Zealand has long been a world leader in agricultural and forestry research and development, but today our R&D extends across a much wider range of industries. These include electronics, telecommunications, information technology, food and beverages, environmental technologies, medicine and pharmaceuticals, biotechnology and energy production and advanced engineering.
New Zealand's growing reputation as a centre for R&D and its ability to enhance new technology is supported by:
| commitment form Government, which provides over 65 percent of the country's R&D expenditure. |
| New Zealand's acceptance and high use of new technologies |
All seven winners in the 1996 New Zealand Export Awards were technology based companies. With a history of innovation supported by an education system producing top class graduates, New Zealand is at the leading edge of technology and R&D.
A CULTURE FOR CHANGE
New Zealand is a nation of innovators and entrepreneurs These attributes are reflected in the many areas in which New Zealand has led the world in change.
| it was the first country to introduce universal suffrage |
| it introduced sweeping social reforms in the 1930s |
| dramatic economic restructuring enabled New Zealand to meet the needs of the 1980s and beyond. |
New Zealand individuals and companies have long been world leaders in developing sophisticated, innovative products - from cold storage and the splitting of the atom 100 years ago to microchip technology, electric fencing, jet boat design, and earthquake-proofing technology, to name but a few.
New Zealand ranks ahead of Japan, Canada, China, Australia, Singapore and Korea as an international leader in innovation. Change and flexibility are part of our culture providing an ideal climate for developing exciting and profitable new industries.
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