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NEW ZEALAND ranks fourth equal with Britain on economic freedom, according to an international survey out last week.
New Zealand has improved dramatically from the mid-1970s when it was ranked 34th in the regular international survey.
But the survey also showed businesses were facing more red tape and were spending more time on government bureaucracy, the Business Roundtable said.
"While New Zealand does not rank poorly overall, we have absolutely no room for complacency," Roundtable policy adviser Norman LaRoeque said.
Over-regulation of business stopped the country from increasing its standing in the Canada-based Fraser Institute's Economic Freedom of the World 2003 Annual Report,
"We fell significantly [from 7.5 points to 3.61 on the measure of administrative obstacles for new businesses, and we slumped [7.8 to 6.81 on the amount of time spent with government bureaucracy," Mr LaRoeque said.
"We also fell on regulatory trade barriers (9.4 to 9.1) and on hidden import barriers (9.1 to 8.5)," he added.
As a small, isolated country, New Zealand was competing for investment. Economic freedom tends to attract investment. The top fifth of economically free countries drew in an average foreign per capita investment of US$2657, compared with only US$52 in the least free nations, the institute said.
New Zealand's score of 8.2 out of 10 in 2001 was level with the score the year before, but the New Zealand ranking rose one place to fourth in the survey.
The ingredients of economic freedom were "personal choice, voluntary exchange, the freedom to compete, and protection of citizens and their property".