Bay of Plenty on track to become 'regional powerhouse'

The lads from TD Haulage have been busy over the past year, says Morgan Dynes (centre) pictured with (from left) Ross Gould, Alan Thomas, Milton Price and Ashford Edwards. Photo / Andrew Warner

Western Bay of Plenty is on track to become a "regional powerhouse" as kiwifruit, freight and building industries put the region ahead in New Zealand economic growth.

Figures released this week show the Bay of Plenty's economy has grown 4.1 per cent over the past year to March 2018 compared with 2.7 per cent nationally. Of this, the Western Bay of Plenty grew 1.7 per cent and Tauranga 4.4 per cent.

Infometrics chief forecaster Gareth Kiernan said non-residential building was strong in Tauranga and freight through the Port of Tauranga and kiwifruit exports were also driving local growth.

Growers had overcome PSA which "would have been a reasonably difficult financial situation for some growers but having two to three years of very good kiwifruit prices and export volumes has been strong as well".

Kiernan warned United States and China trade talks could have significant ramifications if the Chinese market could no longer meet New Zealand export prices. Mycoplasma bovis and a lack of skilled labour were also factors to consider.

"It's important that none of these issues significantly undermined provincial growth over the next 18 months," he said.

At TD Haulage in Mount Maunganui, dispatcher Morgan Dynes said freight had become so busy the trucking company now worked with others, if they were short, to help ensure the job got done.

Dynes agreed there were issues with increasing traffic and a lack of qualified staff.

"Things are busy but because there's a shortage of labour. When we do X amount of loads and you don't have, say, five drivers, you definitely notice a difference."

Tauranga Chamber of Commerce chief executive Stan Gregec said Tauranga's growth had been strong and consistent.

"While our traditional industries have had a good run lately, there's been lots of new growth as well from industry and construction."

Urban drift from Auckland was still a trend but nowhere near the peaks of a few years ago, he said.

"Tauranga continues to hum and we're only at the start of much more growth that will occur over the next decade. We're now seeing investment in real infrastructure and economic assets that will transform this city into a regional powerhouse."

In 2015/16, kiwifruit contributed total revenue of $1.9 billion to the Bay of Plenty.

New Zealand Kiwifruit Growers Association chief executive Nikki Johnson said it estimated this figure could be higher for 2017/18. A University of Waikato report forecast a growth of $4.6b by 2029/30 for the Bay, and $6b nationally.

Johnson said the industry was excited but it had identified finding skilled and seasonal labour as a potential issue and it was looking to identify solutions to address the issue long term.

Priority One communications and projects manager Annie Hill said the region was an increasingly popular place for businesses to base themselves due to competitive advantages.

"These include proximity to international markets through Port of Tauranga, ability to efficiently access over 60 per cent of the domestic market in the central and upper North Island by rail and road links, our ability to attract skilled people due to the lifestyle advantages of being based here and competitively priced business land as a result of good forward planning by our local authorities," Hill said.

"We have also seen extremely strong growth in the horticulture sector [kiwifruit and avocado] and a noticeable increase in high-value businesses providing well-paid jobs."

Hill said there were growing pains involving traffic and house prices but this was more a reflection of experiencing "very strong growth" and infrastructure to support this was lagging behind.