IT industry better fit with NZ brand than dairy?August 19 - 9am
The recent dairy crisis highlights the need for the government to better support New Zealand’s growing IT industry to become the country’s principal export.
That’s the view of Mark Devlin, the Director of Impact PR, a technology marketing agency, who believes the country’s economy must diversify from its traditional dependence on commodity exports.
Essentially, Devlin believes the IT industry provides the perfect future model for exports.
“Since primary exports first began in this country, New Zealand has struggled with our geographical limitations,” he says. “The economies of scale required for us to overcome these barriers as a commodity exporter are significant.
“As food exporters, we have also begun to rely heavily on the New Zealand tourism brand equity as a method of deriving competitive advantage.
“As recent events have shown us, the longevity of the ‘pure’ New Zealand brand is no longer a given.”
Cloud IT industry
Devlin says the cloud IT industry is in many ways the opposite of a commodity export model.
“It fits well within the parameters of our NZ brand where there is little in the way of environmentally damaging by-products , geographical distance becomes almost irrelevant and there is a high level of added value,” he says.
Devlin adds the IT industry has multiple ‘small’ suppliers operating under their own brand – reducing the risk of one player bringing down the image of the industry.
“In addition, a new entrant to the market can launch internationally on the first day meaning there are no cost burdens from foreign tariffs; reducing the need to wait for free trade agreements to be negotiated,” says Devlin, who believes the government has a role to play in developing this industry further.
“There are many high growth cloud tech companies emerging already, which at their current rate of growth are positioned to take the NZ IT industry from its current 5% of GDP to become our leading export within the next decade.”
To support this growth the government needs to better market New Zealand as an immigration destination for countries rich in well-educated techs, while making changes to the processes and costs of immigration to aid and attract this type of employee over competing nations such as the USA and Australia, he says.
Devlin says another key factor in expanding the local industry would be to allow IT firms research and development grants.
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