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Competitiveness: we could do better

Media release
28 September 2005

Competitiveness: we could do better

The World Economic Forum's Global Competitiveness Survey for 2005 backs up recent surveys by Business NZ, says Chief Executive Phil O'Reilly.

The international survey ranks countries on their ability to compete internationally and highlights factors that help or harm countries' competitiveness.

Mr O'Reilly says the international survey shows New Zealand's competitiveness improving from 18th last year to 16th this year, but also confirms the big four issues holding us back:

1 Inadequate supply of infrastructure (ranked 3rd last year)
2 Restrictive labour regulations (1st last year)
3 High tax (2nd last year)
4 Inefficient government bureaucracy (4th last year)

"There are some pleasing results for New Zealand, with improvement in our growth competitiveness ranking. But we still rank below Australia, which improved four places from last year to reach 10th this time," Mr O'Reilly said.

"The survey shows that in the broad areas of macroeconomic environment, public institutions and technology, which make up the growth competitiveness index, New Zealand has improved in all three major groups. We now rank first for public institutions (covering areas such as tax collection, judicial independence, property rights, absence of corruption and absence of organised crime). We have a disadvantage in areas such as the national savings rate, recession expectations, interest rate spread, and the priority given to information technology.

"For the Business Competitiveness Index, we are again in 18th spot, as in 2003 and 2004. We have advantages in areas such as legal framework, professional management, grass-roots involvement in development projects and agricultural policy costs. We have disadvantages in our tax burden, difficulty in hiring foreign labour, the brain drain, shortage of scientists and engineers, centralisation of economic policy making, and hiring and firing practices. Also, we rank rather low for burden of government regulation and reliability of policy services.

"These are issues that New Zealand businesses have raised in our pre-election survey and the 2005 Business NZ-KPMG Compliance Cost Survey, and they indicate that Government action in these areas is overdue."


More information on the Global Competitiveness Survey is on

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