NZ Marks Time on World Economic Freedom Index

NZ Marks Time on World Economic Freedom Index

New Zealand continues to rank relatively highly in terms of economic freedom - but over-regulation of business stopped the country from increasing its standing in the Economic Freedom of the World 2003 Annual Report, New Zealand Business Roundtable Policy Advisor Norman LaRocque said today.

The report was released today by the international Economic Freedom Network, of which the New Zealand Business Roundtable is a member. Reflecting performance in 2001, it is the seventh report in a series produced by hundreds of leading scholars including Nobel laureates.

"New Zealand 's score of 8.2 out of ten puts our nation in fourth place, equal with the United Kingdom - we retain the same score as last year, while our international ranking has nudged up one place," Mr LaRocque said.

"We appear behind Hong Kong (8.6), Singapore (8.5) and the United States (8.3). Australia is ranked seventh with a score of 8.0.

"Economic freedom is vital for prosperity and growth. The key ingredients of economic freedom are personal choice, voluntary exchange, the freedom to compete, and protection of citizens and their property. The report's authors measure these freedoms and protections by looking in each country for property rights, the rule of law, freedom to trade, sensible regulation, and reasonably sized government. "In most areas, we held ground. However, the report identifies a need for New Zealand policy makers to focus on reducing regulatory impediments to business.

"We fell significantly (from 7.5 points to 3.6) on the measure of administrative obstacles for new businesses, and we slumped (7.8 to 6.8) on the amount of time spent with government bureaucracy. We also fell on regulatory trade barriers (9.4 to 9.1) and on hidden import barriers (9.1 to 8.5).

"In light of the debate over retaining access to the Privy Council, it is interesting to note that we fell slightly (9.2 to 8.3) on the measure of our courts' impartiality.

"While New Zealand does not rank poorly overall, we have absolutely no room for complacency. As a small, isolated country, we must remember we are competing for investment. We have a heightened need for economic freedom.

"We need to ensure that we are increasing our score on each measure of this Report if we are serious about returning New Zealand 's per capita income to the top half of OECD rankings.

"The message this year is the same as the one following last year's report: New Zealand needs a credible pro-growth strategy," Mr LaRocque said.

The report can be accessed through the NZBR website, at http://www.nzbr.org.nz/

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