The Organisation for Economic Co-operation and Development published its 2026 Economic Survey of New Zealand, projecting a gradual recovery supported by exports and earlier monetary easing but warning that higher energy prices and global policy turbulence have made the outlook more uncertain. It forecasts real GDP growth of 1.4% in 2026 and 2.3% in 2027, with consumer price inflation at 3.4% in 2026 before easing to 2.4% in 2027, and says policy should keep inflation expectations anchored, preserve the Reserve Bank of New Zealand’s operational independence and continue fiscal consolidation. The survey identifies structurally high electricity costs, ageing-driven fiscal pressures, shallow capital markets and weak productivity as major constraints. It recommends considering Crown minority co-investment in non-gas seasonal firming generation and creating a Firming and Flexibility Market to reduce reliance on gas, strengthening digital health infrastructure and regulation including clearer rules for high-risk clinical artificial intelligence, and deepening capital markets by gradually raising KiwiSaver contributions, shifting pension taxation away from contributions and returns toward withdrawals, expanding venture and growth-equity funding, and establishing a pooled SME loan securitisation platform. On financial stability and public finances, the OECD says banks remain resilient but vulnerabilities among highly indebted households and small and medium-sized enterprises justify continued macroprudential vigilance and banking competition reforms, including open banking and better access to payment systems. It estimates ageing could add around 5% of GDP to health and pension costs by 2060 and recommends combined public pension, private pension and New Zealand Super Fund reforms, including linking public pension eligibility to life expectancy.
OECD 2026-05-07
Organisation for Economic Co-operation and Development publishes New Zealand survey projecting 1.4% growth in 2026 and urging electricity digital health and capital markets reforms
The OECD’s 2026 Economic Survey of New Zealand projects a gradual recovery, with real GDP growth of 1.4% in 2026 and 2.3% in 2027 and inflation easing from 3.4% to 2.4%. It urges keeping inflation expectations anchored, preserving the Reserve Bank of New Zealand’s operational independence and continuing fiscal consolidation. The survey highlights high electricity costs, ageing-related fiscal pressures, shallow capital markets and weak productivity, and recommends energy market reforms, stronger digital health regulation, and capital market deepening via KiwiSaver and pension tax changes, expanded venture funding and an SME loan securitisation platform. It notes resilient banks but calls for ongoing macroprudential vigilance, banking competition reforms such as open banking, and pension and New Zealand Super Fund reforms, including linking public pension eligibility to life expectancy to address ageing costs projected to rise by about 5% of GDP by 2060.