New Zealand was recognised as the fourth best financial market in the world in a report released by the World Economic Forum. The country's relatively smooth ride through the global financial crisis that has left other nations struggling has made New Zealand one of the most efficient financial markets worldwide.
The annual Global Competitiveness Report ranked 148 countries based on their level of productivity and economic prosperity. The financial market development category propelled New Zealand to fourth place out of 148 countries.
In the same category, New Zealand was evaluated how it protects borrowers' and lenders' rights. The World Economic Forum also took note of the New Zealanders' ease of access to loans and soundness of banks. Regulation of securities exchanges also helped boost the rankings of the country.
New Zealand was also named the 10th best country for strong financing activities in the local equity market. It also ranked in the top 20 for availability of venture capital and financial services.
Business NZ Chief Executive Phil O'Reilly said it was not surprising that New Zealand had scored well considering how well Kiwi banks survived the global financial crisis. He said New Zealand banks were careful in avoiding activities that would lead to other banks' failure.
Mr O'Reilly also believed that the business community in New Zealand is "fairly upbeat" compared to those in other countries. Although he thought the country's venture capital financing was relatively subdued, other nations might even have a more subdued status.
The World Economic Forum sought the aid of a business research institute, New Zealand initiative, and the BusinessNZ, in coming out with the report.
Unlike Mr O'Reilly, the executive director, Oliver Hartwich, of New Zealand initiative was surprised with New Zealand's ranking. He said it the nation's financial market was considered tiny when compared to others. He doesn't think the financial market in New Zealand is a world leader.
The Global Competitiveness Report revealed that the economic and financial crisis only highlighted the importance of having a sound financial sector. Since New Zealand ranked 4th best financial market in the world, it means that the country has an efficient financial sector with the right resources to fund investment projects.