New Zealand as the high tech capital of the world?

The tech sector and Government should combine forces to start creating a position of New Zealand as the high tech capital of the world, an incubation nation and a world class digital nation, NZTech recommended today.

The national tech organisation today released a landmark first-ever in-depth study report on the actual state of New Zealand’s technology.

NZTech chief executive Graeme Muller says that while New Zealand has a large and dynamic tech export sector it is not evident in the positioning of New Zealand globally.

“Go to Silicon Valley and talk about agri-tech and everyone says Israel, yet we have a globally respected agri sector. Go to the United Kingdom and mention ed-tech and they say the United States, yet we have a globally respected education sector.

“Ask anyone overseas what they know about New Zealand, and if they know anything at all, it is usually sheep, hobbits and nice scenery. None of this is particularly helpful if you are trying to export high tech products.

“The small size of our domestic market constrains the potential for New Zealand businesses to grow without trading. New Zealand is not going to get rich by selling to itself. The ability for businesses to sell their goods and services to customers in overseas markets is critical.

“For a geographically isolated country like New Zealand, global connections are critical. Falling travel costs and greater connectedness due to technology have reduced the negative impacts of being far from global markets and created new opportunities for trade in many diverse sectors, Muller says.

New Zealand’s exports are predominantly primary products with more than half of all exports in the year to June 2015 from primary products ($35.7 billion).  While natural resources will remain the basis of our competitive advantage for years to come, there are natural limits to the growth of the primary sector and a need to ensure sustainability by working within environmental constraints.

Ultimately, for New Zealand to diversify its export base, technology will play a critical role in creating new exports and higher value niche products that complement our existing national specialisation in agriculture. There is also scope to use technology to improve value-add in agricultural exports, the report says.

Since 1990, exports from New Zealand’s high tech manufacturing sector have grown from under $100 million to $4.4 billion in 2015.  Exports of high-tech goods and services from the ICT sector have grown to $1.9 billion in 2015.  In total, the tech sector generated $6.3 billion of exports, making it the third largest export sector for New Zealand.

A combination of factors may be contributing to the growth of New Zealand tech exports. As well as the growing scale of a number of tech exporters there is also growing breadth. For example, exports from New Zealand video game developers exceeded $100 million in 2015, up from $80 million in 2014.   Tech export successes are also being built off global technologies as local ICT firms find ways to add value to international products and leverage off their channels to market.

Muller says one shining example is Auckland start-up Hapara. Inspired by teachers at Point England school in Auckland, Hapara developed a piece of cloud based software that lets teachers see what students have on their screens when using Google Apps in the classroom. Now only five years old, Hapara tools are used by schools in every US state and in more than 30 countries opening them up to a global edtech market worth $US100 billion.  There are scores of examples like this coming out of the New Zealand tech sector.