Macroeconomic Trends And Conditions Of New Zealand Essay

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In the following essay, various macroeconomic trends and conditions will be explored in reference to New Zealand.

While New Zealand has a rich history dating back to prehistoric times, the main economic development began with the colonization by British explorers in the late 1700’s. Throughout time, the island nation has shared much with its British lineage in that it has been a predominately isolated island nation that relies heavily on international trade. While this has allowed New Zealand to become developed and prosperous, it also exposes their economy to global economic recessions and unexpected swings in various economic indicators. Sections in particular will focus on GDP, inflation, unemployment, credit markets, and lastly fiscal and monetary policy.

New Zealand’s GDP in 2014 was $198.1 billion U.S. Dollars, which ranks 49th in the world. Their economy is free-market oriented and developed, and is routinely ranked as one of the more efficient and least corrupt economies in the entire world [2][3][10]. Currently, GDP expenditure in New Zealand is around 70% based in the services sector, 26% in the industrial sector, and the remaining 4% in agriculture. New Zealand has a high percentage of its GDP composed in both imports and exports in international trade, which stand around 28% for both respectively [2][3]. Because of this high reliance on international trade, the most recent economic recession from 2008-2009 saw real GDP contract for five quarters in a row,
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