The head of the New Zealand Ministry of Foreign Affairs' special relationship unit, David Payton, has praised Niue's effort in bringing in a balanced budget for the past year and reaching a similar agreement for the coming year.
Mr Payton says Niue confronted a huge deficit mid-term and through cuts, including a temporary ten-percent cut to public servants' wages, overcame the debt.
And he says the new budget is, for the first time in a long time, a realistic document that is the result of open and transparent negotiations.
Mr Payton says the revenue will be improved with, for instance, an end to a power subsidy.
"There won't be an artifical cheap rate of power for government departments, for example, they will have to budget and pay the full cost for the real cost of generating electricity - so that's important. Another part of the power equation, people are now far more likely to be paying their pay bills rather than the about fifty percent non payment that happened in the past."