The growth of our economy

New Zealand is a country blessed by a wealth of natural resources.  We have a highly efficient agricultural sector and sizeable manufacturing and services sectors.  Our relatively strong economic performance since 1990 has been encouraging in a context of rapid global marketplace changes and intense international competition.

Along with these advantages, New Zealand faces the disadvantage of being the most physically remote developed country in the world relative to major markets.  A one-day return flight from Hong Kong allows a businessperson to access 42% of the world’s population and 32% of world GDP, but a similar flight from Auckland accesses a tiny 0.4% of population and 1% of world GDP.
 
Despite this obvious reliance on exporting to reach markets of any size, New Zealand has only 160 companies that export goods valued at more than $25 million per annum.  And we have failed to truly diversify our economy: the major exports in 2004 — mainly those from primary industries — were strikingly similar to those of a quarter century earlier. This creates a particular problem for us given that these exports are generally of high volume or weight per unit value, that we have to transport them long distances, and that ocean freight and air transport costs have not declined in real terms for at least two decades.

Although our economic performance since 1990 has shown improvement, large income gaps remain between New Zealand and other OECD countries.  To be able to compete in an internationally mobile environment and to regain our place in the top half of OECD country rankings, we need to introduce new and creative ideas and solutions that will enable a vibrant and thriving economy.  Areas in which the University can make a distinctive contribution include biotechnological innovation, leadership and entrepreneurship, marine industry development and sustainability, and the growth of our export industries.