By Tony Collins CEO,New Zealand Chambers of Commerce Northland
While we have a very diverse economic profile in Whangarei and Northland, the importance of manufacturing cannot be overlooked. In 2011 manufacturing accounted for 21.3% of Whangarei’s total GDP. It was the largest contributor to the districtÕs growth and also an area where Whangarei has a significant comparative advantage.
Not surprisingly, much of this manufacturing is closely related to Northland’s traditional primary industries in particular forestry and farming. The presence of Refining NZ at Marsden Point is another major contributor which may skew the overrepresentation when compared to the national average.
The challenge for Northland is to widen the base of its manufacturing and lessen the dependance on a few large key businesses.
Northland’s close proximity to Auckland, our deepwater port, rail connectivity, ultrafast broad band and a good supply of commercial Greenfield land, means that there is an opportunity to encourage inward investment for firms that would have traditionally considered the North Shore as their preferred place of operations.
When taken into account along with a low risk of natural geological disasters, good schools, a pleasant climate and outstanding natural environment, Northland becomes a particularly attractive place to establish a manufacturing business.
While it is important to continue to add value to primary products before they leave our region and the country, this does not mean that we should not also be focusing on innovative and technology based manufacturing.
Several Northland companies are performing internationally in this area in a very successful manner. These companies often occupy a niche international market and operate largely unnoticed by the wider community.
To grow our regional economy and increase our productivity requires innovation and the identification of those international niche markets where our comparative lack of size can actually be a competitive advantage. Increasing our GDP will require a shift to a high wage economy.
Successful manufacturing and export businesses have shown that isolation and scale are not in themselves barriers to a successful manufacturing enterprise. These companies are involved in manufacturing things of high value by weight and that have a high profit margin.