Gaurav Sharma
Auckland, October 17, 2024
The contribution of ethnic businesses to the economy has been a key part of the country’s overall growth since New Zealand first started sending exports abroad.
Political parties on both sides of the aisle have recognised this in recent years, launching targeted talkfests focused on further unlocking the potential of ethnic businesses.
In May 2023, the Ministry of Ethnic Communities held the inaugural Ethnic Business Forum.
Almost 18 months later, the Ministry held the first-ever Ethnic Xchange Symposium.
Despite bearing different names, the underlying message was essentially the same as speakers extolled the contributions that ethnic businesses made to the economy.
According to a Sense Partners report undertaken for the Waitakere Ethnic Board, ethnic businesses contributed $64 billion to the economy in 2021 – almost 20% of New Zealand’s total GDP that year.
Key to Unlock True Potential
Ethnic communities in New Zealand are defined as those who are not Māori, New Zealand European or Pasifika.
They include individuals from Asia, Europe, Latin America, Africa and the Middle East, making up roughly 24% of the country’s population in 2021.
In June 2022, the Auckland Policy Office published a report that focused on the contribution of ethnic businesses to Auckland’s economy. Ethnic communities contributed $33 billion, or around 30%, of the city’s total GDP in 2018, the report said.
These communities made up 37% of Auckland’s total population.
However, Finance Minister Nicola Willis said that exports were key to unlocking the community’s true potential.
“Data from 2022 shows ethnic businesses represent 20% of all businesses in New Zealand, that is one in five. And about 13% of New Zealand businesses export goods to the rest of the world,” she said in her keynote speech at the symposium on October 11, 2024.
“This is where it gets interesting because ethnic businesses are distinguished from other New Zealand businesses by trading high-value export products. The average export goods value for ethnic businesses is more than double the New Zealand average. So, when I contemplate our goal of doubling the value of exports over the next decade, we need the other four in five businesses to create as much value as our ethnic businesses do. We need ethnic businesses to lead the way in demonstrating to other New Zealand businesses where the value lies and where those opportunities are,” she said.
Trading Aspirations
Ethnic Communities Minister Melissa Lee called on ethnic businesses to support the country’s trading aspirations, “as they bring expertise in navigating overseas markets and international business environments.”
“Our Indian diaspora can have a huge impact in ensuring the New Zealand-India free trade agreement gets across the line,” Lee said.
Indian New Zealanders, who are now the third-largest ethnicity in the country, contributed $10 billion to the economy in 2019, or 3.3% of the country’s total GDP, according to a 2020 report prepared by Sense Partners for the Waitakere Indian Association.
Ms Lee said that the entrepreneurial zeal of migrants in New Zealand was not a new phenomenon.
The first exporter
“Did you know a Chinese man [named Chew Chong] was the first person from New Zealand to export butter to Mother England?” she asked.
According to the Ministry for Culture and Heritage, Chew Chong (Chau Tseung) was born in Canton (Guangzhou), China, sometime between 1827 and 1844.
He arrived in Otago in 1867 before settling in New Plymouth, from where he started his butter business. Chong is credited for installing the first freezing machine in a New Zealand butter factory and inventing a rotary butter worker. He sold his butter in New Zealand and shipped it to Australia and England.
Meanwhile, Regulation Minister David Seymour promised a less regulatory landscape for ethnic businesses.
“The attitude of being on guard when our friends from around the world want to invest here needs to change. When people from overseas bring their money and know-how here, it is a vote of confidence in New Zealand,” he said, speaking at the Symposium.
“To attract foreign investment, the country needed to possess good quality investible propositions,” said Peter Chrisp, Chief Executive of New Zealand Trade and Enterprise.
“We currently lack such opportunities, which is the big dilemma. On the other hand, New Zealand companies willing to succeed overseas need to have a precise value proposition, understand the market it is trying to enter and focus [on depth over volume]. India is obviously a sleeping giant for us,” he said.
“This is evident from the fact more New Zealand companies are in Singapore than the ones doing business in the world’s most populous nation. But we know it and are determined to change it,” Mr Chrisp added.
Business leaders
Business leaders from the ethnic community shared the challenges they had faced operating in New Zealand.
“There is a shortage of networking platforms for ethnic businesses,” said Kenneth Leong, Director at Tiaki Capital. “It is good that this symposium is happening.”
Priti Ambani, Country Head for the Indian IT services provider Tata Consultancy Services, said certain cultural barriers hampered active collaboration in New Zealand.
“You cannot fit in if you do not go to the pub or do a barbecue. We need to lower such barriers,” she said.
Ranjna Patel, Co-Founder of Tāmaki Health and a recent inductee into the New Zealand Business Hall of Fame, said that ethnic business owners had to be persistent.
“When we opened our first clinic in Otara in 1973, we wanted to make healthcare accessible to the Māori and Pasifika population. We operated extended hours in the mornings and evenings. Our peers did not like it, and some complaints were filed,” she said.
The complaints did not deter Patel and her husband, Dr Kanti Patel, who together turned Tāmaki Health into the largest healthcare provider in the country, with nearly 50 clinics totalling more than $400 million in value.
Importance of data
Delegates at the Symposium spoke of the need for more data to be compiled on the country’s diverse ethnic communities.
Carolyn Tremain, Chief Executive of the Ministry for Business, Innovation and Employment, said that the Agency had not collected data on the communities until a few years ago.
However, things are changing.
Mervin Singham, Chief Executive of the Ethnic Communities Ministry, said in November 2023 that compiling data was important “to act as a catalyst to strengthen the evidence base across the public sector on the needs and contribution of ethnic communities in Aotearoa New Zealand.”
“The Ministry was working with Stats NZ on a new data standard for ethnicity. It was also working with MBIE to produce a regular Asian Labour Market Statistics Snapshot, with the first published in the June 2023 quarter,” he said.
Gaurav Sharma is a Senior Journalist at Radio New Zealand. The above Report and pictures have been published under a special agreement with www.rnz.co.nz.
