New Zealand ready willing and able

Friday, 01 December 2000


    Savvy Australian investors looking to grow their business in an environment that supports and encourages knowledge-based industries, entrepreneurs and innovation should first look to New Zealand.

    Whether your business is considering expansion or relocation, New Zealand has the infrastructure, people and solutions that create dynamic enterprise. The country's appeal can only be enhanced by the solid commitment from its private and public sectors, together with the Government, for New Zealand to take its place in the global knowledge economy. Numerous Australian investors have already recognised the benefits of doing business in New Zealand, contributing 38 percent of international investment into the country. Interestingly, this is twice as much as the US – the next biggest investor by country in New Zealand. The strong growth in interest from Australian investors over recent years sees Investment New Zealand – the division of Trade New Zealand responsible for attracting international investment – putting special emphasis on its trans-Tasman neighbour. Its commitment to investors in this market is demonstrated by the appointment of Barry Orr of Orr Strategies as Investment New Zealand's representative in Australia.

    New Zealand boasts promising investment opportunities for international companies in the advanced technology fields such as smart manufacturing, IT and T, electronics, software, life sciences, or in areas where New Zealand has a comparative resource advantage such as food and wood fibre industries. The country's macro economic environment provides investors with a transparent and stable platform for long-term business. Technology and training grants are available to both local and foreign owned companies. Renowned for New Zealanders' can-do attitude, New Zealand enjoys a reputation as a good place to do business, especially for its light-handed regulatory regime. What is less well known is New Zealand's cost competitiveness – which means business costs, particularly for staff, are significantly lower than in other first world economies, including Australia. New Zealand has been rated among the more competitive nations in the world by the World Economic Forum. A decade of radical economic restructuring has helped shape its success as a truly competitive international location.

    By relocating to New Zealand, businesses can significantly reduce costs through access to a well-educated and cost effective labour force, and up-to-date telecommunications and transport systems. And while New Zealand enjoys its long-standing Closer Economic Relationship with Australia, it is also committed to building its presence in the Asia Pacific region and recently signed the Singapore/New Zealand Closer Economic Partnership (SNZCEP) Agreement. This agreement, which will eliminate tariffs on goods traded between the two countries, will bring exciting new opportunities for the traders, industries and entrepreneurs of each country. The benefits of investing in New Zealand are wide and varied:

    • A supportive environment to nurture knowledge-based industries

    • High technology clustering -world-class companies in an active life sciences, IT, electronics and telecommunications cluster offer scope for research, technology and commercial collaboration

    • Low business costs

    • Competitive, productive, skilled and flexible workforce

    • Modern infrastructure

    • Stable, straightforward and honest style of Government

    • Duty free entry to the Australian market and excellent links with markets in Asia Pacific

    • Light regulations – the Government makes it easy to get things done

    • Simple tax system with no payroll or wealth taxes

    • An investment agency backed up by a team of local economic development agencies and professional advisers that can minimise your investigation and set-up time.

    New Zealand's open business environment promotes free market values and business certainty. Friendly New Zealand attitudes ensure new entrants to the corporate business scene find it straightforward to make valuable contacts, with easy access to high-level decision-makers. Labour market regulations, designed to foster productive workplace relationships, impose no significant constraint on business operations. New Zealand is already positioning itself as a leader in the knowledge economy. It is well set up for e-business, with a sophisticated communications infrastructure and an increasing number of IT graduates. Graduate numbers have increased steadily since 1998 at a growth rate of 40 percent with predicted growth of at least 30 percent to 2003.

    New Zealand is leading Australian businesses in internet use – with 68 percent of all New Zealand firms using the internet compared with only 57 percent of Australian firms. In addition, over 50 percent of New Zealanders are connected to the internet, and the growth in internet usage in New Zealand has been exponential. New Zealand also enjoys cheaper and more widespread access to the internet than Australia. New Zealand has developed a specialised cluster of competencies in advanced manufacturing. The country's small size gives its manufacturing sector the flexibility to retool quickly and handle small, specialist production runs. New Zealand is renowned for being a niche specialist in manufacturing and design, and this offers significant competitive advantages for international manufacturers or investors. It has developed innovative solutions to engineering problems in areas such as speed motor control engineering, systems automation and stainless steel fabrication. New Zealand has also developed strong capability in electrical and electronic engineering including power systems analysis, power electronics, control robotics, radio and microwave engineering, communications systems, mobile and personal communications, signal, image and speech processing, machine vision and micro electronics.

    As the holder of the America's Cup, New Zealand's high profile leadership on the water has been echoed on land in the yards of boat builders, sail and spar makers, hardware, electronics, technology, software and systems specialists. This sector has a turnover of $NZ400 million and exports of over half that. New Zealand is now the fifth largest builder of super yachts in the world and has pioneered the application of high technology composite construction materials in the marine industry. New Zealand also offers an environment that helps companies to develop and maintain a cutting edge position in telecommunications related niches. Its research institutions are world class and support commercial development. The new Southern Cross cable stretching from New Zealand to Australia and the US brings greater connectivity than ever. The Southern Cross cable went live on 15 November. During the past seven years, telecommunications sales offshore have lifted from $50 million to more than $200 million – an increase built on sales won from more than 100 countries around the world. These sales are the result of the intelligent marketing of specialised equipment and services into niche markets where needs are not being met by the large telecommunication companies from Europe and the United States.

    New Zealand offers particular advantages in the field of digital wireless and optical communications including excellent software and electronics engineers at very competitive rates, a modern, deregulated telecommunications infrastructure, and a track record in commercial design and production of wireless telecommunications software and hardware. Companies actively researching, designing and manufacturing in New Zealand include Alcatel (France), Digital Microwave Systems (USA), Ericsson (Sweden), Invensys (UK) Allied Telesys (Japan) and Tait Communications (New Zealand). New Zealand's largest electronics company, Tait Communications is a leading, international supplier of mobile communications equipment – exporting 90 percent of its production with sales of around $150 million each year. The company began in 1969 with a staff of 12 and now employs 850 people in New Zealand and another 150 offshore. There have been more recent major additions to New Zealand's growing high tech sector. In October, global communications company Ericsson New Zealand and US company GeoVector Corporation joined forces to develop new wireless technology, which will be trialled with Vodafone New Zealand over its newly launched General Packet Radio Switch (GPRS) network. The initiative will create up to 40 new jobs in Auckland.

    The companies were introduced by Investment New Zealand as part of its efforts to promote New Zealand as an exciting and technologically savvy country. It is targeting companies looking to undertake leading edge research and development in emerging technology with real market potential. It's an example of a company recognising the advantages of undertaking hi-tech R&D and product development in New Zealand and its ability to provide the people with the right skills to make it happen. In another positive boost for New Zealand's economy, Ericsson and award winning New Zealand software developer Synergy have announced they are establishing a new Mobile Internet Applications Centre in New Zealand. The centre – which will create about 150 jobs – will be developing mobile internet solutions to be marketed around the world. Investment New Zealand worked extensively with Ericsson over the past year on the potential for expanding the company's R&D activity in New Zealand. A drive to be globally competitive has led New Zealand down the information technology highway. Like Australia, the widespread adoption of IT occurred earlier in New Zealand than in many other countries and has generated a thriving software industry – with New Zealand spending seven percent of GDP on IT, which is among the highest in the world. Growth rates approach those of software focused centers such as Ireland and Israel.

    The electronic transportability of software makes New Zealand's location irrelevant in the international marketplace, as modern communications and local distribution arrangements enable easy after-sales supports to customers anywhere in the world. Now positioned as a global supplier of niche solutions, New Zealand software is in demand internationally. A growing number of multinationals have already invested in New Zealand, including GEAC (Canada), Platinum and Trimble Navigation (USA). Companies like IBM, Unysis, Digital and Fujitsu have strategic alliances with New Zealand software developers. Today's high tech trading environment demands that businesses become 24 hour a day, seven day a week operations. With New Zealand the first to see the new business day, our time zone allows your business to get ahead while the competition is sleeping. Combining an advantageous time zone with a multi-lingual population used to flexible working hours, New Zealand is the ideal location for call centres (full service help and information services) and those businesses with a global focus.

    Normal working hours in New Zealand correspond roughly with those in the Australian east coast cities, being between two and three hours ahead, depending on variations in summer daylight-saving time. New Zealand also has the potential to begin service as the working day concludes in central and eastern United States cities – which adds flexibility to services and offers potential cost savings by using daytime staff who are less likely to attract penalty rates and other costs such as parking and meal allowances. A recent study undertaken by KPMG for Investment New Zealand, shows that New Zealand's call centre operating cost per seat is on average 20 percent lower than Australian locations. In comparison to Sydney, Auckland is 40 percent lower. This cost saving is mainly due to lower labour and property costs. At the same time, quality of service in New Zealand is high. A recent international customer service survey rated New Zealand second out of 20 countries (Teleperformance International Grand Prix in Teleservices Customer Service).

    Similar research on back office-type operations shows Auckland offers a significant cost advantage over Sydney and is more competitive than Brisbane, Adelaide and Melbourne. Life sciences are an area where New Zealand's traditional pastoral industries and the scientific developments that have supported them create a comparative advantage for investors. The country has high quality and cost competitive Government and university research facilities, excellent animal health status and a science community with strong international linkages. The world's largest pharmaceutical manufacturer, Glaxo Wellcome, began in New Zealand producing human health products from the country's health-assured agricultural stock. Increasingly new enterprises are doing cutting edge research in health and creating intellectual property around national strengths. So think New Zealand – and think success.

    Information for potential investors is provided on the New Zealand Trade Development Board's investment website accessible at Contact can also be made with Investment New Zealand via the site, by calling team director Gary Langford, on 64 9 915 4250 or by e-mailing investment manager Nick Arathimos at


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