The Economic Impact on Pacific People of New Zealand: A Report

This report provides a comprehensive overview of the economic impact on Pacific people in New Zealand. It begins with a historical context, tracing the evolution of the New Zealand economy from subsistence to its current state. The report highlights the positive impacts, such as improved living standards, reduced poverty, increased literacy rates, and advancements in technology and infrastructure. However, it also delves into the negative consequences, including environmental depletion, exhaustion of natural resources, and increasing income inequality. The analysis assesses the overall well-being of Pacific people, considering economic performance and the provision of social, political, and economic services. The report uses economic indicators to evaluate poverty reduction, income inequality, health, education, and human resource growth, concluding with an assessment of the population's contentment and access to essential services and facilities.

1ECONOMIC IMPACT ON PACIFIC PEOPLE OF NEW ZEALAND
ECONOMIC IMPACT ON PACIFIC PEOPLE OF NEW ZEALAND
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HISTORICAL CONTEXT:
The world map depicts New Zealand as two islands lying gloriously on the south west
part of Pacific Ocean in the Southern hemisphere of the Earth. The geographical territory of the
country majorly consists north and south islands with presence of almost six hundred smaller
islands and surrounded by sea and oceans. This not only led the country to possess rich
biodiversity and natural resources but also made it remote and disconnected from the world. No
wonder why the landmass was explored and settled much later by the human race as compared to
other places of the world.
Employment opportunities along with the flexibility in citizenship and rights of residence
in New Zealand have led to substantial increase in migration of Pacific peoples into the islands.
The change in the policies of the government of New Zealand is taken in order to boost the
industrial growth and economic development of the country. The history of origin of the nation
dates back to approximately700 years. It was the time about 1250-1300 BC when the
Polynesians started living in these islands now known as New Zealand. They developed a
distinct Maori culture which is found to be the most primitive existence of human race on the
rich land masses. The European explorations started around 1642 with Dutch being the first non-
natives to find the nation. Later in 1840 a treaty named Treaty of Waitangi was signed between
British and Chief of Maori clan to officially declare the nation operative under sovereignty of
Britain. Just years later the nation became British Empire’s colony and took 66 years to become
a Dominion of present time in 1907. The country is home to rich and diversified ethnic groups all
over the world but Europeans who consists of 74% of the total population take higher proportion.
Maori follows them by contributing almost14.9% to the population and 11.8% consisted by

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Asians (Kelsey, 2015). The pacific people are the 4th largest ethnic group to reflect the
population of New Zealand that also by 7.4% as per the recent estimates (2013). There was a
dearth of skilled labor in the island and this gave rise to talent gaps to combat the situation,
During the 1950s immigrants from Denmark, Germany, Switzerland and Austria settles in the
islands in to find occupation in specialized fields around this time new Zealand also signed an
accord with Netherland that was bilateral in nature to recognize and give shelter to the skilled
immigrants.
The existence of these pacific people in new Zealand can be traced back in the ancient
time of formation of the country and they mostly origin from different small islands of Pacific
Ocean surrounding the nation.
EVOLUTION OF ECONOMY
Throwing light on the ancient economic condition of the nation prevalence of subsistence
economy is evident prior to the explorations and colonization made by Europeans and British
respectively. Existing sub-tribe Hapu was the basis of economic unit. The exploration by various
trading ships of France, America, and Britain embarked in 1790 (Rodrik, 2014). The ships
loaded with European goods were started being traded with the Maoris to meet their basic need
of food, water, shelter. Various metal tools were also exported to the islanders. Initially the
settlers derived their food from the Maoris. After the nation became British colony, the existence
of self dependent farmers increased. The large-scale agricultural activities transformed the
landscape of the country to well nurtured farmland from dense forests. Apart from agriculture,
mining was another important economic activity present in that time which is evident in the
quarrying of minerals and metals. The discovery of gold in Otego however marked a turning

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point of the economy of New Zealand as this created a hue and cry worldwide for these precious
metals that set the wealth of the nation. This initiated a Gold Rush in 1861 that remarkably
changed the economic condition owing to two fold increases in population and fivefold increase
in the volume of trade.
In 1870 the nation saw its first economic collapse in form of long term depression
stemming from larger burden of borrowing toward the end of gold rush in order to conduct
various programs and investments targeting public welfare and infrastructural development like
rail and roads. The depression led to mass unemployment and huge emigration to Australia.
.However the economy bounced back to boom again in 1890 and the next hit it faced was
the Great Depression of 1929 in the post world war global condition. Even though the country is
small, it has trading ties with many countries giving UK top position.
A significant setback of the economy took place when the great depression hit the world
market. In the year 1929 when the global market had shrunken the economy of New Zealand
also went down with it, already the economy was facing troubles post World War I. The relation
between the British had become strong over the years and the maximum amount of international
trade was being taken place in between Britain and New Zealand (Jeffs, 2015).
Economic development in New Zealand is affected by several internal as well as
international factors. Since the establishment in the year 1934, the Reserve Bank is the most
important financial institution in the New Zealand economy. Economic growth is referred to as
the rate of development and improvement of the national income of a country, which is measured
by the yearly percentage rate of change of country's gross domestic product. Development of the

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economy has its own positive and negative impacts on the lives of the people of New Zealand
and pacific.
Over the passage of time the manufacturing of the nation evolved which was mostly
confined to local small activities. Large factories produced farm and resource processing
including gas conservation, timber processing, aluminum &steel production and so on. The
joining of European Union by UK compelled the nation look for substitute for its export, which
in later period became the nations like Australia, China, Japan and US. The labor reform of New
Zealand brings forth the new turning point that created much debate so as to assess the effect of
the reforms focused mostly on removing tax from imports. These led to higher unemployment in
the economy hurting domestic producers. 200 onwards the country has been more diverse along
with being a string market economy having compact and integrated global connection achieved
through international trade. The service sector of the economy consists of 63% of the total GDP
indicating dominance of the sector in outlining national economic output.
IMPACT OF ECONOMY ON PACIFIC PEOPLE
Positive Impacts:
Some of the positive impacts are: elevated the standard of living among the people of
New Zealand and pacific region. Before the advent of the European and the British culture the
people of these areas used to trade for their own selves and did not aspire to work and build a

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civilized society. Legends and storytelling were the fundaments of the early people living in this
region. But, there has been an unparalleled improvement in living standards in most parts of the
pacific region after the advent of the European culture. Mannerism, social behavior, development
of cities and town, improved transportation and increased usage of technology etc. For example,
once the facility of a reading light was considered to be a luxury and was only for the rich who
could afford the technology of light and electricity, today about 75% of the world has access to
electricity in their homes (Scott & Boyd, 2016).
Secondly, poverty is reduced due to the development in the economies. There is a
positive relationship between economic growth and the rate of poverty reduction in developing
countries. Pacific people have gained trade insights and expertise from the European and British
people who had come to this region in order to explore business opportunities. With money
flowing in to the economy poverty decrease considerably. During the great depression the
economy face challenges and many people were left with negligible resources, however the
country stoop up and changed the course of the economic development.
Thirdly, the consistently higher literacy rate prevailing at 99% over the past years shows
the remarkable impact of social and economic planning and programs on the pacific people of
New Zealand. This further reflects the huge planned investment and good structure of the
education system.
Fourthly, Development and improvement of technology and technical infrastructure is
another positive impact of economic growth in the pacific region. The money in the deposit of
the government of the pacific region has increase with economic development which has enabled
large investments in technological infrastructure. There are also several private investors in

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technology which has enabled decreased rate of electricity, telephone charges. Consumption of
internet has increase over the past decade owing to the investment in this sector which has lead
to a decreased rate of data. Mobile devices and connectivity has also improved exponentially
with the improvement in the economies of New Zealand (Rodrik, 2014).
Negative Impacts:
Some of the negative impacts of the development of the economy are significant in New
Zealand. Firstly, environmental depletion and exhaustion of natural resources in the region is one
of the most crucial negative impacts of economic development. Economic improvement paves
the way towards environmental depletion and this is bound to reduce the sustainable rate of
development. For example: the cutting down of the rain forests through deforestation in order to
build houses and industries, the over use of fish stocks and pollution is a significant issue which
leads to the loss of natural habitat and in turn loss in several species of flora and fauna (Kelsey,
2015).. The bio-diversity exploitation from the construction of new roads, hotels, malls and
industrial estates are the impact of economic growth and development. In order to develop and
promote urbanization and industrialization he forests and the tress are cut and natural habitat for
many flora and fauna has been destroyed which has further led to extinction of various species as
well for example moa. Various types of pollution that are being faced by the people of New
Zealand is the direct effect of economic development. Air, water and land pollution have a
significant impact on the natural balance of any area (Nel, 2015).
With the development of the economy one of the major impacts that have a negative
effect on the economy of New Zealand is the increased inequality in the income of the people.

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Rich people becoming richer and the poor are becoming poorer. The gap in between the rich and
the poor is increasing day by day due to the development of the economy. Differences in the
income of the people lead to economic incompetence, discouragement of social stability and
solidarity and its unfairness to some sections of the society in general. Increased inequality
persuades rent seeking behavior, the people with resources concentrate on encouraging results
that help them too be more productive. However, improved investments in public health,
education and other relevant infrastructure could help reduce this adverse effect of income
inequality in New Zealand. Income inequality is a direct outcome of unemployment as of 4 Aug
2011, New Zealand has an unacceptable unemployment rate of 6.5% or 154,000 unemployed
(Rashbrooke, 2013).
OVERALL ASSESSMENT OF GENERAL WELLBEING
The overall wellbeing of the pacific people can be assessed based on the economic
performance of the nation and its ability to provide good social, political and economic services
to its citizen. The statistics revealing the facts of the economic indicators helps get a snapshot of
the economy achieving reduced poverty and income inequality, increased health and education
services captured through lower morbidity rate and higher literacy rates, higher incomes. Growth
of human resource are based on these indicators that collectively conclude whether the national
people are contended and living a happy and healthy life having access to services and facilities
maintaining standard and quality (Houkamau & Sibley, 2014).
The first and foremost impact on the pacific people residing in New Zealand by the
national economy is growing income levels owing to annual GDP growth of 3.5%. Tourismalong
with agriculture and horticulture, forestry and fishing have a significant impact on the growth of

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the economy in New Zealand. The GDP per capita is 39,426.62 USD, which indicates upper
income level of the country as whole. The increase in income leads to greater expenditure on
basic amenities of life which further makes the lifestyle improved and better over time. It
enhances the ability of affording education and improved health services. The estimated Gini
coefficient of 0.32 reflects existence of much lower rate of income inequality that reflects good
health of the economy showing lower bias in resource distribution among population. The
current death rate in the country is 7.4 deaths/1,000 populations which is much lower compared
to other nations of the world. The average life expectancy of the population as whole is 81.46
years higher than average of 60-70 years even in first world countries of world. The reason
behind such higher life years is the improved health care service backed by technological
advances. A higher literacy rate of 99% reflects the feasibility and accessibility of pacific people
to education, which has remained consistent over years. This has added to the enhanced quality
of the human capital. The important issue that the economy of New Zeal land has borne for years
from the ancient time is the unemployment, which is still 5.7% of the labor force showing a
greater estimate compared to global countries (Rashbrooke, 2013). The social as well as
economic impact on the pacific people is rightly captured by the Human development Index
value which is close to 0.915. The greater the economic performance the higher is the standard of
living in presence of lower inequality and national security.
Even though various inward-looking economic policies and global financial turmoil
slowed down the economic efficiency and flexibility of the country it has always managed to
bring back the stability adopting significant policies and expanding the sectors that has
competitive advantage.

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