New Zealand First Party Chooses Coalition

Having made the announcement on October 19th, the New Zealand First party has officially aligned itself with the Labor Party, putting new Prime Minster Jacinda Arden into power. This comes as a surprise to the largest party, the National Party, which had expected to continue leading the government.

Various announcements have now been made about the Labor-First coalition. Of the New Zealand First party’s nine minister, four are being awarded cabinet positions, while one member is awarded a junior position. Among these is William Peters, the New Zealand First Party leader, who is being considered for Deputy Prime Minister.

The Green Party, while not strictly part of the Labor-First coalition, is negotiating a supply and confidence deal. Such a deal would trade Green party votes in exchange for access to budgetary resources for favored policies.

Given Green party leader James Shaw’s enthusiasm, it is expected such a deal will prove successful, giving the Green Party its first ever commanding role in government. This will also fully complete the needed coalition to form a majority for the Labor and First parties.

In the wake of this news, questions are now being raised over which policies this new government will pursue. Already foreign investors have pulled out money from the real estate market, expecting new restrictions on real estate purchases.

There are also questions being raised of what the new “New Zealand Fortress” will do regarding the heavy amount of Chinese investment in the country. Given both parties concerns about the foreign ownership of New Zealander land and industries, concerns are high among Chinese investors.

Figure 2: Source The Guardian

Relatedly, there are also questions being raised over the status of foreign students and workers. The New Labor government has promised to reduce immigration from 70,000 per year to around 40,000 per year. They have also hinted at increasing the difficulty of acquiring residency and work status for international students.

Budgetarily there have also been concerns raised, as one of the key First Party policies seeks to make an expensive relocation of a port in Auckland. Having a high estimated cost, as well as associated infrastructure needs, such a plan is anticipated to spike government expenditure.

In the face of these deviations from the previous governments agenda, the National Leader, Bill English, vowed to make his 56-member party the “strongest opposition party ever.”