Australia, don't stuff up; NZ needs you

Summary:A survey out last week showed that New Zealand's tech sector is growing healthily, with a factor being burgeoning exports to Australia.

A survey out last week showed that New Zealand's tech sector is growing healthily, with a factor being burgeoning exports to Australia.

No longer should New Zealand be known simply as "China's Farm" for its dairy and lamb exports, but instead the "Techie Isles", the name of this blog, seems to be an inspired choice!

The tech sector, including hi-tech manufacturing, as well as bio-tech and ICT, is now firmly establishedas the country's third-biggest export earner.

Technology, reported the Technology Investment Network (TIN), now brings in export revenues in excess of NZ$7 billion per year, up 5 per cent year on year. This compares with the market-leading dairy sector, which generates NZ$11 billion in exports, and the meat industry, which enjoys annual exports of NZ$5 billion.

The latest annual TIN survey of New Zealand's 100 largest tech firms and 100 emerging tech firms also reveals that the numbers employed in technology grew from 24,000 to 30,000 as the country's tech sector "bounced back" from the Global Financial Crisis.

Furthermore, such local technology firms are also achieving scale, with 30 per cent of the TIN 100 enjoying revenues above NZ$50 million per year, another first. These firms increased in number by 15 per cent to more than 30, as New Zealand develops larger and more capable companies.

The annual report also noted some new emerging stars, such as Orion healthcare, a software business employing 500, gaining much work from the USA. Rakon, which makes GPS crystals, is also enjoying success in America, and it has also recently opened a factory in China. Wellington-based IT services provider Datacom was revealed as another winner.

And it is thanks to Australia that New Zealand has derived some of our success, with our neighbour's strong economy providing great opportunities for Kiwi firms.

Australia is where the action is, TIN publisher Greg Shanahan said, with both it and Asia taking 40 per cent of Kiwi technology exports. A favourable exchange rate is also proving particularly beneficial to manufacturers such as Methven and Fisher & Paykel Appliances.

Now, Australia has always been a significant bridgehead for New Zealand firms looking to go global. Its prosperous market has been a boon for many, including Telecom offshoot Gen-i, as well as datacentre operator Revera, who gained a share of the government IaaS work last week.

Such stories of Kiwi firms moving into the Australian market before exporting further afield have been a common subject for kiwi journalists covering New Zealand's tech sector over the years. We do rely much on Australia for our prosperity.

It is heartening that when news headlines are dominated by financial crisis, or the fluctuating price of milk fat solids, New Zealand has another success story that it can be proud of.

There remain clouds on the horizon, such as concerns over exchange rates and company failures, as well as successful Kiwi innovators being bought out by overseas interests, such as RightHemisphere, particularly after receiving taxpayer support.

Nonetheless, New Zealand has in tech a sector that brings home the bacon. The question is: how to make it bigger? Industrialists and academics have their ideas, with research and development being a major factor (TIN noted 15 per cent growth here).

But, as noted by the TIN 100, one vital success factor seems to be what is happening in our major export markets, that they maintain strong economies.

Thus, for the success and prosperity of the New Zealand tech sector, amid others, we look to Julia Gillard and whoever replaces her not to stuff it up!

Topics: Government, Government : AU, Legal, New Zealand, Start-Ups

About

Darren Greenwood has been in journalism, not all of it IT, since the days of typewriters and long before the web spun its way around the world.Coming from Yorkshire, he can be blunt, and though having resided in New Zealand, as well as Australia, for quite some time, he insists he is not one of the 'sheeple!'

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