Unlike many larger OECD countries, New
Zealand did not suffer the severe recession that hit most of its
peers. Many investors and others
wondered why and this was largely due to the strict banking and lending
standards that New Zealand has in place. This regulatory environment meant that
the subprime loan market, which caused the recession, didn't affect the
country, since New Zealand had virtually no subprime market to begin with. When
a country’s banks are not making risky loans, the effects from an economic
slowdown are not nearly so severe as they inevitably must be in other countries
that do have an unsound subprime loan market.
New Zealand enjoys other financial advantages
from which its investors profit. The
economy of the country is diverse.
Moreover, its central government has successfully positioned its economy
as a global leader amongst smaller nations.
In the currency exchange market, this has constantly held true. New
Zealand’s comparative advantage is maintained, even as the U.S. economy
improves. Likewise, the currency has
gained as well and in fact, the currency of New Zealand is considered the second best performer against the U.S. dollar
among 16 major peers tracked by Bloomberg in 2014, with gains approaching 4%:
unlike others, such as Canada, which suffered the biggest loss at -3.6%.
Recently, New Zealand’s dollar has further
benefited from a Central Bank that in 2014 became the first in the developed
world to raise interest rates since 2011.
At the same time, an economic revival is currently in progress, boosting
its currency. It is also noteworthy that
New Zealand’s currency has been unaffected by plummeting oil prices. That is largely due to the fortunate fact
that the country is not nearly as commodity-dependent and resource-reliant as
are so many others.
The land of the Kiwi has a
vibrant export economy – dairy production being its flagship export commodity.
The developing world has a thirst for increased dairy usage and New Zealand’s
economy will be the beneficiary of this for many years to come. New Zealand is
also very stable politically, as well as financially, and it enjoys one of the
highest standards of living of any OECD country. There is very little
corruption and both ruling parties are centrist in ideology. Thus, no wild policy swings can be expected
if the government changes.
According to Luigi Wewege, CEO of boutique
Auckland, New Zealand investment firm Vivier & Co: "New Zealand not
only offers investors a secure place to deposit their money but also financial
returns that far exceed what’s available in most Western countries.” Luigi adds
that: “Unsurprisingly, we’ve seen a global uptake in investors who want to
enjoy the attractive rates New Zealand offers, without undue exposure to
exchange rate risk."
Due to New Zealand’s relative close
proximity to Asia, too, it has long been considered a safe haven for investors
from Asia’s developed countries, particularly China and Japan. These investors
are also attracted to the country’s lifestyle, with its good schools, low crime
rate and clean environment. New Zealand
in turn counts China as its largest export market, and speculation is rife that
policy- makers there will take emergency steps to stimulate the struggling
Chinese economy and in so doing give a further boost to New Zealand’s strong
dollar.
New Zealand’s economic success story offers
investors peace of mind, knowing that they can invest safely, and with high
confidence in their yield outpacing that of comparable investments virtually
anywhere else in the world.
About the
Author
Jay
Douglas writes exclusively for the Los Angeles and Santa Monica Business
Examiner. Jay is also the founder and Owner of Prediction Tracking which was
started in early 2009 as a way of measuring the results of prognostications,
who too often make forecasts with little accountability on whether they're
accurate or not. Prediction Tracking posts interesting predictions in a myriad
of categories, and then tracks events concerning the future.
About Examiner.com
Established
in 2008, Examiner.com has revolutionized the creation of original content at
scale through tens of thousands of freelance contributors and its own national
editors. We are a multifaceted media company with over 17 million monthly
unique visitors to our consumer website and dozens of high-profile clients
through our custom content solutions, OnTopic.com.
About Luigi Wewege
Luigi
Wewege is the founder of Vivier Group & CEO of its Auckland
based financial services arm Vivier & Co. He is also the Managing
Director of its sister companies Vivier Investments, Vivier Developments, Vivier Home Loans and Vivier Mortgages.
Vivier & Co
Vivier and Company Limited (‘VCL’) is
registered in New Zealand under number: 1130618. VCL is a member of Financial
Services Complaints Limited a New Zealand Government approved Dispute
Resolution Scheme, and maintains an insurance policy with Standard and Poor's
A+ rated insurers, providing a NZD2,000,000 indemnity on any one claim/loss in
the aggregate.
For
further details, please contact
Press at Vivier
Group
Level 31, Vero
Centre, 48 Shortland Street Auckland 1010, New Zealand
+64 9 889 3998
