At the end of February, the government released its Building Capital Markets progress report. This is the sixth and final report of a series of progress reports which focus on the six elements the government has identified for business growth. It follows reports on Export Markets, Innovation, Skilled and Safe Workplaces, Infrastructure and Resources.

The Building Capital Markets progress report outlines the government's seven key initiatives to build New Zealand's capital markets. These are:

In addition, the government is planning to:

  • Better regulation to lift confidence in New Zealand's financial markets – the government has already put a number of these regulations in place, including:
    • new requirements for financial services providers and advisors to increase investor confidence in the financial services industry;
    • the establishment of the Financial Markets Authority to promote fair, efficient, and transparent financial markets and to play a more active role in surveillance and enforcement;
    • a new licensing and oversight regime for trustees and statutory supervisors;
    • the Reserve Bank's implementation of Basel III capital adequacy requirements (which came into force on 1 January 2013).

In addition, the government is planning to:

  • implement a macro-prudential policy framework for the management of financial system-wide risks;
  • improve the integrity of New Zealand companies by requiring resident directors under the Companies and Limited Partnerships Amendment Bill;
  • deliver regulations under the Financial Markets Conduct Bill that require simplified financial product disclosures;
  • introduce responsible lending requirements for consumer credit providers; and
  • introduce amendments to enable funds domiciling.
  • Strengthening public equity and debt markets – this initiative includes the Dairy Industry Restructuring Act which enabled Fonterra to pursue the Trading Among Farmers Scheme. The government also plans to:
    • partially list four energy State-owned enterprises on NZX;
    • investigate options for lower cost public listing to increase access to capital for New Zealand's SMEs;
    • pass the Financial Markets Conduct Bill to make it easier for listed companies to raise capital;
    • make it easier for businesses to offer employee share schemes;
    • pass the Financial Reporting Bill to reduce unnecessary financial reporting costs for businesses; and
    • enable NZX to develop a dairy futures market.
  • Lifting our national saving rate to reduce overseas debt – this includes supporting KiwiSaver as a vehicle for building New Zealanders' retirement savings;
  • Supporting early-stage and growth capital markets – this includes regulating new forms of intermediated capital raising such as 'peer-to-peer lending' and 'crowd funding' under the Financial Markets Conduct Bill;
  • Encouraging efficient private capital markets – the government is providing more options for SMEs to raise capital under the Financial Markets Conduct Bill. In addition the government is working towards:
    • improving the operation of the housing market;
    • improving the utilisation and productivity of Maori assets;
    • delivering programmes to improve New Zealanders' financial and investor literacy; and
    • investigating the development of a specialist exchange for co-operatives on NZX.
  • Improving the management of Crown capital – which will include increasing the number of public-private partnerships;
  • Attracting foreign investment – this includes aligning business law between Australia and New Zealand; advancing mutual recognition of imputation and franking credits with Australia; and investigating the overseas investment screening regime to treat NZX-listed companies with no more than 49% foreign ownership or control as New Zealand companies.