The emergence of e-commerce and the phenomenal growth of communication technology have removed the ‘tyranny of distance’ that had traditionally impeded trade between New Zealand and other countries in the past, Prime Minister John Key said.
He said that Asia is increasingly becoming an important market for New Zealand with its current symbiotic relationship.
Speaking at a breakfast meeting organised by ‘New Zealand Asian Leaders’ (NZAL) at Grant Thornton in Auckland City on April 28, Mr Key said that Asia will be a superpower with impressive rates of economic growth.
“The dramatic change is the increased level of New Zealand’s engagement with Asia in terms of inward investment, presence of Asian banks, investment in properties in Christchurch and a vibrant Import-Export market. The huge potential in Asia is developing into several areas in New Zealand, including larger number of international students and tourist arrivals,” he said.
However, Australia, Europe and North America will remain major markets for New Zealand, Mr Key added.
Export focus
According to him, Asian countries are at an interesting stage of growth and development that would entail international expertise.
“New Zealand has long-standing relationship with Asia but what is new is that the region has now become our primary market. We have the capacity to accommodate more people and hence we need to attract those with skills, capital and the right attitude. We are also concentrating on export education because, apart from accruing revenue, international students become great ambassadors of New Zealand and have the potential to be good migrants,” Mr Key said.
Chinese connection
Outlining the dramatic improvement in bilateral trade between New Zealand and China, he said that at the commencement of the Free Trade Agreement (in 2008), the two-way trade was valued at $6 billion of which imports constituted a major share. However, the forecast for 2015 is $20 billion, of which about $12 billion will be New Zealand’s exports to China, he said.
Shamubeel Eaqub, Principal Economist at the New Zealand Institute of Economic Research believed that physical distance and travel time between Asia and New Zealand could be an issue. ‘Economic distance’ can be reduced through knowledge, supply chain and intensive foreign investment.
“But we are not doing enough in this direction. Investors and consumers of tomorrow are in Asia. We must understand the cultural differences and ways of doing business. Asian investors would expect different processes, rights and return. New Zealand must understand the Asian culture and bridge the gap to leverage the positive aspects of both cultures,” Mr Eaqub said.
Perception change
Patton Limited Global Chief Executive Sameer Handa said that culture is in important issue that can neither be overlooked nor over-emphasised.
Asian investors are in comfort zone while dealing with their own people since they strike common chords of language, understanding and outlook.
“We can offer comfort to Asian investors by changing or improving their perception about New Zealand. We must promote some of the best attributes of our country. New Zealand is a safe and fully developed country with a low level of corruption. It has a well- defined and clear legal framework and promotes a diverse and multicultural society. We have a highly skilled and educated workforce. These facts should be promoted,” he said.
Mr Handa said that New Zealand should build and maintain stronger relationships with Asian students studying here. Whether employed in New Zealand, in their home country or elsewhere in the world, they form an essential link with potential investors. America has done well by choosing bright students from Asia and offering them scholarships to study and contribute to the progress of the economy,” he said.
Thai example
He said that New Zealand should streamline systems and procedures and offer better tax and other incentives to foreign investors.
Citing the example of Thailand (where his company has a manufacturing plant and sales offices), he said that the country’s Board of Investment’ functions as a one-stop-shop for foreign investors.
“While Thailand’s Free Trade Agreement with a number of countries is beneficial to us as well, the Thai Government facilitates quick processing of visas for skilled labour, making it attractive for foreign companies and investors to do business,” Mr Handa said.
Earlier, Employment & Public Law Specialist Chen Palmer Managing Partner Mai Chen said that Asian leaders – those in business and in the community – formed the vital link to Asia, which holds the future of the world. She said that NZAL was established last year to reinforce the intellectual, financial and physical capital of Asians in New Zealand and encourage Asian leaders to play a more prominent and decisive role in the country’s economic and social progress.
