'We must get better at exporting'

The widely-held belief that minerals were why Australia's economy was so much stronger than New Zealand's was downplayed by a key speaker at the New Zealand Shareholders Association annual meeting in Tauranga on Saturday.
Rick Boven, director of privately funded think-tank the New Zealand Institute, said the country was at a crossroads with high debt, low capital investment, low skills, low growth and a big outflow of migrants.
The conference attracted nearly 250 members from all around New Zealand to hear guest speakers, including Reserve Bank governor Alan Bollard.
In his address, Dr Boven stressed the big difference in labour productivity, with Australia a lot more productive than New Zealand in just about every sector. "It is not a story of minerals."
Australia's export sector productivity output was $70 per hour worked, compared with New Zealand's $40 and shrinking.
His address stressed how productivity gains were driven by innovation in technology, talent and investment.
Dr Boven said Australia had nearly a 20-year headstart on New Zealand when it came to innovation. "We don't have the same incentives."
He highlighted New Zealand's braindrain, its large pool of unskilled people and poor investment record, with low personal savings and low savings incentives.
Dr Boven said there had been over-investment in New Zealand's residential housing sector and under-investment in the productive sector.
"There is not enough capital in our economy."
Agriculture and tourism were important but the economy needed to be transformed. Five million New Zealanders could not live off the wealth of 10,000-20,000 farmers.
Dr Boven said New Zealand had to look past the old ways of selling its commodities on world markets, such as logs, wool and milk powder. "We have got to get better at producing a wide range of things."
The products would still be based around New Zealand's natural advantages but a change in attitude was needed to understand what international markets wanted.
"That transformation is important and we are only starting to go down that path."
He said New Zealand needed to triple its exports in 15 years to achieve a 4-5 per cent per capita growth increase. To do that, it needed a strategy that focused on the sectors in which the country had a natural advantage.
The main approach would be to increase high-value exports. He said that needed more entrepreneurial talent, expanding investment capital and assisting exporters so they were not left to "work things out as they go".
New Zealand universities produced graduates that suited domestic business and he urged them to take a leaf from Auckland University's Business School, which now had a fulltime course in entrepreneurial studies.