NZ Manufacturer, June 2023

A mere 30 New Zealand companies, according to the Productivity Commission, account for over half of all exports. They say focus really needs to be on innovation and moving away from volume to value-added products.

So, what are overseas trade visits for? Do business legations need to be vetted to determine that the ‘fact finding trip’ is not just an overseas holiday? Do they bring back business for the country?

How much money has government invested over the years in trade visits that result in absolutely no return?

Dairy is New Zealand’s biggest export earner – worth about $19 billion a year.

The largest increase for the year ended December 2022 was for milk powder, butter, and cheese. This is New Zealand’s largest export commodity group, making up 28 percent of total exports over the year.

This industry group, with a proven track record, doesn’t need to justify the trip; they have established markets and maintain them very well.

To get more than 30 companies contributing to our export success, we need to increase productivity which needs: a positive attitude and involvement of management; proactive employees; good working conditions; tools and equipment available to raise productivity and the availability of input supplies.

The four determinants of a nation’s productivity are physical capital, technology, human capital, and natural resources. Technology is a decisive factor in productivity, along with physical capital (equipment used to produce products), human capital (the knowledge of labourers), and natural resources.

Now all of this sounds logical but obviously is not being put into practice(properly) if only 30 companies generate most of our export revenue. What are the restraints?

At present, the shining light for export growth appears to be the gaming industry. What is everyone else doing?

We are in a constant state of ‘fixing things’ or ‘trying to fix things’ which costs the country a lot of money for not a lot of return. Let’s give the 30 companies a hand!