Groundhog Day for the government's export goal; We've been here before: Govt's already asked exporters what's wrong, so why another glossy booklet?

By Alex Tarrant

Wouldn't it be wonderful for New Zealand to increase exports from 30% of GDP to 40%?

Just think of the higher standard of living we could have, better medical care, support for the vulnerable and such things.

Isn't it great then that we have a government focussed on achieving this goal by 2025?

Well actually, isn't it great that we've had successive governments focussed on achieving this ten percentage point boost.

And isn't it great we've had successive governments consult exporters on what's standing in their way to exporting more and let us know what's wrong.

Now even though the previous Labour-led government consulted on the impediments to exporting more and higher value products, the current lot obviously decided those responses given last decade were all wrong.

Either that, or the 2007 work programme was lost as files were being shuffled around during the creation of the new Super Ministry.

Glossy booklets

Releasing a very fancy glossy booklet on building export markets on Wednesday, Economic Development Minister Steven Joyce, Finance Minister Bill English and Trade Minister Tim Groser acknowledged the 30-40% jump was an ambitious goal.

The government wanted business and investors to know it was "on their side" and that New Zealand was "open for business" as it sought the capital and set the regulatory environment to help achieve this.

The Building Export Markets report was not so much a policy document, but a progress report "on the government's work to help grow New Zealand's export opportunities and build sustained economic growth," Joyce et al. said on Wednesday.

The first of six progress reports on the government's Business Growth Agenda, the Ministry of Business, Innovation and Employment (MoBIE) wanted exporters to provide feedback on its workstream "to assist us in focussing our efforts," it says in the report.

To recap, those six reports are on: Capital markets, Innovation and ideas, Skilled and safe workplaces, Natural resources, Infrastructure (including electricity, broadband, transport); and Export markets.

All six will have been issued by the end of the year. So if you're an exporter, then could you just let MoBIE know what's wrong in these areas.

And quickly please, we've got an economy to grow.

Feedback

Now I'm no sage, but it could be that the feedback to the government on what's holding back exporters might go something like this:

• a lack of skilled people to help grow their business;
• a lack of scale to be able to compete effectively on the world stage;
• difficulty in acquiring relevant knowledge of, and expertise in, foreign markets;
• difficulty in positioning products in international markets in order to attain high value;
• problems in accessing the necessary capital, resource and investment needs;
• inefficiencies caused by compliance and regulatory issues (both in New Zealand and internationally).

That's pretty focussed and even sounds like I might have consulted a few exporters myself, you may say.

Well that's because it's from an even glossier report issued in 2007 (the so-called 'Export Year') by former Trade Minister Phil Goff and Economic Development Minister Pete Hodgson titled, Platform for the Future.

ie. It's been done before.

The government has already asked what's wrong. It has said it will create a policy environment to "support and encourage businesses to be more internationally competitive" (2007) in the quest to boost exports, which funnily enough would require a "more concerted effort to develop more internationally competitive businesses" (2012). 

Then it has set goals for the export sector to achieve by saying who we need to catch up to.

So let's compare

So just for fun, try picking which of the following two statements came from Platform for the Future, and which came from Building Export Markets (and don't peek by going through to the links first).

Firstly:

"Our exports of goods and services represent around 30% of GDP. This is about the OECD average but well below the 40%-50% of GDP for similar-sized OECD countries. Recent growth in the New Zealand economy has been greater in the non-tradable sectors than in those parts of the economy that compete on the international stage. Our international competitiveness has been declining and, since the mid-2000s, our export performance has suffered."

Against:

"However, while other OECD countries have been rapidly increasing their export intensity, exports of goods and services have remained at about 30% on New Zealand's GDP, a similar level to the mid 1980s.

"There have been some periods when our export intensity has ‘spiked’; for instance, in 2001 when relatively high commodity prices combined with a very low New Zealand dollar. However, the trend has been for New Zealand’s export intensity to remain static – exports have increased but, unlike in many other OECD countries, they have not increased faster than overall GDP. Consequently, our export intensity is now well below other OECD countries of a similar size, for which exports represent over 40% of their GDP."

Pretty similar eh.

(The first was from this week's report, the second from 2007.)

It's wonderful successive governments have wanted New Zealand to boost its export capabilities, and it's a good thing exporters are consulted on how best to do this.

But for goodness sake, they have already been consulted (and consulted before that), and given some pretty clear answers on what they want.

Successive government policy on boosting exports appears to be: if we keep saying it, it will come true.

But perhaps it won't.

What we can be sure of is that another glossy booklet without significant economic policy change has not worked in the past.

You've done the consultation already guys, so just get on with the response.