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S&P heaps praise on New Zealand's Covid-19 response, upgrades nation's credit rating

The Government says its handling of the Covid-19 pandemic has led to a "faster than expected economic recovery", which has been acknowledged in a credit rating upgrade today.

The Beehive, New Zealand's Parliament. Source: istock.com

Credit ratings agency Standard & Poor’s (S&P) has raised New Zealand’s local currency credit rating to AAA with a stable outlook.

S&P praised New Zealand's handling of the pandemic in a press release, saying New Zealand is recovering quicker than most advanced economies because it has been able to contain the spread of Covid-19 better than most others.

“New Zealand is recovering quicker than most advanced economies after the Covid-19 pandemic and subsequent government lockdown delivered a severe economic and fiscal shock to the country,” S&P said.

“While downside risks persist, such as another outbreak, we expect New Zealand’s fiscal indicators to recover during the next few years.”

Finance Minister Grant Robertson weighed in on the news this afternoon.

“We have always said the best economic response to this pandemic is a health response, which is why we went hard and early with our decisions just over a year ago,” Robertson said.

“The economy has bounced back because we did not waste any time as we saw the pandemic take hold overseas. We supported around 1.8 million workers through the wage subsidy scheme and invested billions in infrastructure, training and creating jobs.”

Robertson noted there are still challenges ahead for the economy, but "we are well positioned to handle them".