Market Update: October 2017
In what took almost a month to be decided, Labour party leader Jacinda Ardern has been declared New Zealand’s newest Prime Minister.
Although Labour received 35.8% of votes, considerably less than the National Party’s 46% of votes, New Zealand First held the balance of power to decide who to allocate their votes to. New Zealand First’s leader Winston Peters ended up supporting Ardern, which came as somewhat of a surprise given Peters’ previous backing of former National PM Bill English.
In a recent press conference, Peters explained the thought process behind New Zealand First’s decision. “We had a choice for a modified status quo or for change…that’s why in the end we chose a coalition government with New Zealand First and the Labour Party,” he said.
Peters has become Deputy Prime Minister—Ardern told media that this role was offered to him and Peters has since accepted the role. Forming a coalition with Peters’ party, Labour will also have an agreement with the Green party to support the government on confidence and supply. Meanwhile the National party holds onto 56 seats, making them the strongest opposition ever seen in New Zealand.
Ardern, who only became the Labour leader three months ago, will become the country’s third female prime minister and the world’s youngest female leader. It’s been nine years since Labour were in power in New Zealand.
One of the hot topics across this election was the reduction of immigration. Labour have said they’ll aim to reduce the number of immigrants by up to 30,000 each year. This figure is estimated to include up to 10,000 students. However local prospective students can breathe easy, with a plan to provide three years of free tertiary education from 2025, with a bid to also increase the amount of allowance students receive.
Ardern also has announced that a referendum on whether to legalise recreational marijuana use would be held within the next three years, which is part of the Green party’s drug reform policy. Other policies Labour are heralding include the decriminalisation of abortion, reducing greenhouse gas emissions and banning foreign spectators from purchasing property in New Zealand. It will be interesting to see her policies take shape, particularly in the property space.