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Beyond Business As Usual Commentary by Industry Development Manager Nick Inskip Pure Advantage, the not-for-profit organisation, in their recent report ‘New Zealand’s Position in the Green Race’ (www.pureadvantage.org) provided a compelling rationale for why we need a strategy to take advantage of the opportunities provided by emerging demands in the global clean technology marketplace. The report clearly articulates the core message that “New Zealand needs to build wealth as a country”, and provides strategies to support achieving that goal through facilitating and coordinating efforts between major corporates, industry groups, academics, iwi, and the Government. The report says that, “A strategic willingness by Government to induce change is important in the implementation of green growth.” The words ‘induce change’ are critical to the future of New Zealand and particularly the high- value manufacturing sector, because ‘business as usual‘ won’t provide the gains needed to meet the current and future aspirations of New Zealanders. The comment by Prime Minister John Key when talking about the formation of the new Ministry of Business, Innovation and Employment, that “This new department will help to drive the Government's priority of building a more productive and competitive economy," would seem to be a signal of an intent that fits with the need to induce change, and there is little question that urgent change is needed. It was quite sobering to see in one of the graphs presented in the report that the real contribution of New Zealand per hour worked to GDP is only just ahead of Greece! If nothing else, it highlights that we are spending too much of our labour hours on activities that do not have sufficient value. Figure 25: EXPORTS PER CAPITA in the report, which was originally published by the New Zealand Institute in 2010 in their document, ‘A Goal is Not a Strategy’, graphically shows the problem. In New Zealand, agriculture accounts for over half of GDP while in Denmark, a country of comparable population, it accounts for roughly the same $ value, but represents only one-fifth of their GDP, the balance being mostly high-value manufacturing with a small proportion being crude materials, beverages and tobacco, which are almost identical for the two countries. So we can say that when it comes to agriculture, tobacco and beverages and crude materials we are almost identical. Beyond that there is a significant gap at the high-value end of things that acts as a handbrake on the aspirations of all New Zealanders. There is little value in looking backwards to see what went wrong and trying to apportion blame. The focus now must be on looking forward and that is what ‘New Zealand’s Position in the Green Race’ does. It is time to accept that we must ‘induce change’ and that Government must partner with industry in providing the leadership and support required. The challenge is going to be how we find the resources to support the development of the high- value manufacturing industry to a point where we can equal Denmark, when we have been used to focussing resources predominantly into agriculture-related areas. We have heard a myriad of times that the financial situation means that there needs to be belt tightening. While Denmark spends more than twice the amount New Zealand does on Research & Development as a percentage of GDP and has nearly a third more scientists and engineers as New Zealand, the issue is more one of priorities - do we have what it takes to induce change or not? As I have said before, ‘Business as usual’ isn’t an option; the high-value clean technology market is. Geothermal Trade Delegation – USA May 2012 Report by Industry Development Manager Nick Inskip There are few places in the world further away from large markets as New Zealand is, which should be enough reason to get on a plane and have a look at the opportunities that are out there. That is exactly what a delegation of New Zealand companies interested in the geothermal market HERA NEWS Jul 2012 Page 4PDF Image | Electricity Generation Supercritical CO2 Geothermal Siphon
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