New Zealand is set to be the fastest growing economy in the Australasian region this year and next, thanks to its success in the containment of coronavirus as well as wider border relaxations forecast for 2022.

This is according to data published on Tuesday by research house, Fitch Solutions.

However, growth in this region is still being challenged by "various downside risks" such as low vaccination rates in the near-term, whilst mounting geopolitical tensions with China and issues relating to climate change will cloud the growth outlook over the longer-term.

Fitch Solutions forecast Australasia's total GDP to average 2.5% this year and 2022 following a 4.0% contraction in 2020, with growth unbalanced across the region.

"Countries that have found relative success in mitigating the economic impact of the Covid-19 outbreak, such as New Zealand will recover at a faster pace," according to Fitch.

"We believe that New Zealand will be the growth outperformer in the region.

"We forecast New Zealand's economy to grow by 5.5% in 2021 and 4.4% in 2022, following a contraction of 1.2% in 2020.”

Fitch added: "The country found early success in mitigating the viral outbreak in 2020 and has since been able to keep its economy mostly open with limited and short-lived localised lockdowns in some parts.

"New Zealand's growth in 2022 will most likely be propelled, especially if the country re-opens its borders to international tourists as planned, though this will be contingent on its vaccination programme."

Around 15.7% of New Zealand’s population has received the Covid vaccine, slightly less than Australia’s 18.2%, reports the New Zealand Herald.

However, Prime Minister Jacinda Ardern put New Zealand under strict lockdown on Tuesday after Auckland reported the first Covid case in six months. The country will go into level-four lockdown for a minimum of three days from Wednesday.

Ardern told a news conference: "The best thing we can do to get out of this as quickly as we can is to go hard.”

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