Why NZX is central to driving economic growth.
Now is the time for a strong Kiwi comeback. For the past two years, the government has been an over-sized driver of economic activity but, as New Zealand begins to reopen to the world, the comeback will be increasingly driven by the business sector.
This year is a pivotal year. We have faced a sustained public health crisis, one that demanded the strongest possible government-led response. Kiwis unified behind that effort, revealing a community-wide strength of purpose that served us well.
But now it's time to unleash the private sector's potential to fuel the country's economic recovery. The private sector accounts for some two-thirds of the national economy – and accumulating public debt for consumption purposes is not sustainable in the medium- to longer-term.
NZX has been working hard the past four years, executing a strategy to strengthen and position the NZX Group to support a step change:
- Changes made by NZX to reduce complexity and cost – and the hard work of our team – has seen a quality pipeline of new capital listings, with 17 new listings in the past two years.
- Total capital listed and raised (new and secondary) is up 12.1 per cent to $19.8 billion this past financial year.
- Our debt markets – incorporating mainly government and corporate bonds – are also performing strongly, with 21 new debt issues over the past year and one new issuer joining the debt market. Wellbeing and green bonds now total $9.78bn and represent 21 per cent of the NZX debt market.
- The total value traded across our markets remains high at $52.4bn for FY21. The number of trades in the last financial year increased 27 per cent, which reflects heightened investor interest from retail investors. Greater demand for NZX data from offshore, too, has seen an 11 per cent increase in professional data usage, now at record levels. This is evidence that international investors are seeing the opportunities. Connecting with others through strategic partnerships is another key performance indicator for NZX, providing more opportunities for Kiwi investors.
- For example, NZX's vision for a fully functioning dairy market, a decade in gestation, has seen NZX develop a global dairy derivatives market alongside our quality data and insight offering. That's resulted in the fastest-growing dairy derivatives market globally through this period. Our partnership with Singapore Exchange (SGX) – allowing the listing of dairy derivatives contracts on the SGX – enhances that vision.
- So does NZX's recent cornerstone investment in Global Dairy Trade, alongside the European Energy Exchange and Fonterra, which underscores NZX's ability to build and drive growth from strategic partnerships as well as support global trade.
- Smartshares has a very important role in increasing the participation of a wider range of investors in capital markets. The savings solutions and range of exchange traded funds offer an alternative, efficient and well-priced set of products to investors, particularly retail investors. More and more investors are appreciating the Smartshares products and solutions, and this is demonstrated in the growth momentum this business is delivering.
- As a result of these strategies and more, we're seeing more than three million investors engaged either directly in the exchange or through their KiwiSaver. Growing, connecting, and creating value for investors, businesses and shareholders is NZX's goal as we pivot towards a new normal. We are more determined than ever to help drive New Zealand's step change recovery.
The number of Kiwis invested through NZX continues to grow. Not only are we seeing growing numbers of retail investors, but two-thirds of the population are now also KiwiSaver investors. This is a generationally momentous shift, and we see more growth potential ahead.