New Zealand Political Shift Has Economists Worried

Increasing support in New Zealand for minor parties likely to join a Labour-led centrist coalition after the Nov. 27 election, has economists worried fringe left-wing parties could influence future government policy. The concern is that New Zealand could get a government that would undo hard-fought economic gains of the last few years that have produced sustainable growth with low inflation and unemployment. The election is shaping up as a close race. A switch to a center-left Labour-Alliance coalition, with support from the Green Party, seems the most likely outcome. But some opinion polls suggest former treasurer Winston Peters and his New Zealand First party could hold the balance of power between Labour and a center-right coalition of the ruling National Party and ACT New Zealand. More than 20% of votes are expected to go to minor parties.

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