New Zealand's country risk was upgraded from deteriorating at the start of the year to improving by Dun and Bradstreet, but the credit reporting agency warns there is still work to be done.
"The critical factor now is how New Zealand executives respond to this improving environment," D&B New Zealand general manager John Scott said.
New Zealand recorded its third consecutive quarter of growth in December and needed to maintain that momentum.
With reduced support from the Government's economic stimulus package and the potential for interest rates to rise in the months ahead, 2010 would continue to be challenging.
D&B's Economic and Risk Outlook Report showed New Zealand ranked second (DB2c) in the Asia-Pacific region, although 16 countries were ranked higher on a global scale.
New Zealand's rating was the seventh-highest possible, in line with Hong Kong and Japan.
"Positively for New Zealand, its risk trend has been categorised as improving, while Hong Kong's is classified as stable and Japan's deteriorating, following a downgrade earlier this year," Mr Scott said.
Australia was the highest-ranked country in the region and globally at DB1d, in line with Canada, Norway and Switzerland.
Its rating was expected to be upgraded during the year as the macroeconomic outlook steadily improved.
The outlook for key trading partners was mixed.
Japanese-based firms were expected to face significant pressures through 2010 as they continued to consolidate and struggle to maintain market share worldwide.
Recent economic indicators suggested the recovery in the United States remained fragile.
Other key trading nations for New Zealand, including the US, the United Kingdom and China, were rated DB2a, DB2b and DB3d, respectively.
South Korea was only one ranking behind New Zealand and had recently been upgraded, Mr Scott said.
"A continuation of improving economic conditions would bode well for New Zealand's reputation as one of the safest countries in which to invest within the region."
D&B's country risk indicator placed New Zealand in the top four safest countries in the region and the top 20 globally.
That was a significant achievement and demonstrated the strength of New Zealand's economy when the rate of recovery in many other developed nations was sluggish.
