New Zealand's economy is relatively risk-free but its position is getting worse because of declining export prices and high unemployment, commercial analysis company Dun & Bradstreet says.
According to D&B's Global Risk Indicator – which analyses the political, commercial, economic and external risk of doing business in 132 countries – 56 nations have had their risk rating downgraded over the past three years.
Twenty-three had their risk rating upgraded.
New Zealand's risk rating has not been downgraded since 2011, and while it is rated low-risk, its risk profile is getting worse because of declining export prices and unemployment rising to 7.3% late last year.
D&B's New Zealand general manager Lance Crooks says the deteriorating risk profile is concerning, despite good economic conditions locally.
"New Zealand's exposure to world markets means that external developments will have a knock-on effect on the domestic economy.
"In light of the high number of downgrades globally, a full economic recovery from the 2008-09 crisis remains uncertain.
"As such, the possibility of a further downgrade cannot be ruled out," Mr Crooks says.
Nearly half of the total risk downgrades in 2012 were in the struggling eurozone and half of its countries received at least a downgrade last year, including Germany, France, Switzerland, Spain and Greece.
Mr Crooks says for many countries, recovery from the global financial crisis is especially difficult, particularly in volatile eurozone countries.
"Normally, this far into the recovery we would expect the figures to be reversed, with a large number of upgrades and only a few downgrades.
"Given the current track record, it's improbable that the world economy will resume pre-GFC growth levels until at least 2017."
This article is tagged with the following keywords. Find out more about MyNBR Tags
Most listened to
- Business Week in Review with Grant Walker & Andrew Patterson
- Matthew Hooton on the state of the British Labour party under Jeremy Corbyn
- Rodney Hide on the Ombudsman’s investigation into SSC conduct of MFAT leaks inquiry
- David Cohen on how to walk out of a TV interview
- Imperial Tobacco lobbyist insists NZ visit about “contributing expertise,” not pressuring government on plain packaging law