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In 2004 it began discussing free trade with China, one of the first countries to do so.

The conservative National Party and the left-leaning Labour Party have dominated New Zealand political life since a Labour government came to power in 1935. During 14 years in office (1935 - 1949), the Labour Party implemented a broad array of social and economic legislation, including comprehensive social security, a large scale public works programme, a 40-hour working week, a minimum basic wage, and compulsory unionism. The National Party won control of the government in 1949 and adopted many welfare measures instituted by the Labour Party. Except for two brief periods of Labour governments in 1957 - 1960 and 1972 - 1975, National held power until 1984.

New Zealand (like Fiji) decided against joining the Commonwealth of Australia in 1901, and instead changed from being a colony to a separate "dominion" in 1907, equal in status to Australia and Canada. New Zealand retained an avowed loyalty to the British Empire of which it formed a part, and contributed proportionally large numbers of troops to aid Britain in the Boer War (1899 - 1902), World War I and World War II (see New Zealand in World War II). New Zealand's complete independence was formalised by the 1926 Balfour Declaration and the 1931 Statute of Westminster, ratified on November 25, 1947. The monarch of the United Kingdom remains the monarch of New Zealand, which has been an independent constitutional monarchy. In 1951, the Legislative Council was abolished as ineffectual, thereby creating a unicameral legislature.

A number of New Zealand commentators have observed that there is no culture in New Zealand. This has led to protests from those who believe that there is a uniquely definable New Zealand culture. Perhaps one of the more memorable protests was the 1980 song "Culture" by The Knobz after outspoken Prime Minister Sir Robert Muldoon stated that New Zealand pop music was not part of the New Zealand cultural scene.

God's Own Country, or Godzone, is generally accepted, by New Zealanders if nowhere else, as the alternative name for New Zealand. God's Own Country was the title of a poem about New Zealand written by Thomas Bracken about 1890. (He also wrote God Defend New Zealand, which became the country's second national anthem). It was a favourite saying of Richard John Seddon, Premier of New Zealand for 13 years (1893-1906).

New Zealand imports much of its cultural material from overseas, particularly from Britain or the United States. Most successful Hollywood films screen on New Zealand cinema screens and New Zealand Television shows a lot of British and American television programmes. It is somewhat ironic that some of these programmes are now made in New Zealand but receive their first screening elsewhere. The New Zealand cinematographic industry is becoming one of the country's major export enterprises, with several major motion pictures being filmed on New Zealand locations recently, including the highly acclaimed film adaptation of Tolkien's "The Lord of the Rings" directed by the Kiwi Peter Jackson.

New Zealand has a strong party system in place. The first political party was founded in 1891, and its main rival was founded in 1909 — from that point until a change of electoral system in 1996, New Zealand had a two-party system in place. Today, New Zealand has a genuinely multi-party system, with eight parties currently represented in Parliament. Neither of the two largest parties has been able to govern without support from other groups since 1996, meaning that coalition government is common.

New Zealand is heavily dependent on trade—particularly in agricultural products—to drive growth, and it has been affected by global economic slowdowns and slumps in commodity prices. Since agricultural exports are highly sensitive to currency values and a large percentage of consumer goods are imported, any changes in the value of the New Zealand dollar has a strong impact on the economy.

New Zealand has no native land mammals apart from some rare bats. Later Maori largely subsisted by cultivating the kumara, a type of sweet potato, which they had brought with them from Polynesia.

The Cabinet, which is responsible to Parliament, exercises executive authority. (The Cabinet forms the practical expression of a formal body known as the Executive Council.) The Prime Minister, as the leader of the political party or coalition of parties holding the majority of seats in the House of Representatives, leads the Cabinet. All Cabinet Ministers must be Members of Parliament (MPs) and are collectively responsible to it.

New Zealand functions as a constitutional monarchy with a parliamentary system of government. The basic system is closely patterned on that of the United Kingdom, although a number of significant modifications have been made. The head of state is Queen Elizabeth II, but actual government is conducted by a Prime Minister and Cabinet drawn from an elected Parliament.

New Zealand's scenery has appeared in a number of television programmes and films. In particular, Hercules and Xena were filmed around Auckland, Heavenly Creatures in Christchurch. The Tribe is set and filmed here too. Peter Jackson shot the epic The Lord of the Rings trilogy in various locations around the country, taking advantage of the spectacular and relatively unspoiled landscapes, and Mount Taranaki was used as a stand-in for Mount Fuji in The Last Samurai. Other movies currently filming in New Zealand include King Kong and The Lion, the Witch and the Wardrobe.