Fran O'Sullivan: Beefing up of skills needed

Nathan Guy with Hikurangi Swamp farmer Edwin Smith after yet another flood in Northland. Photo / Michael Cunningham

Nathan Guy retains his ministerial role but he needs to dig deep to change a passable performance last time

The announcement of John Key's ministerial line-up for National's third term in government featured a handful of surprises, particularly where security and intelligence are concerned - but he opted to primarily maintain the status quo in the agri-sector.

Nikki Kaye vacates her role as Minister for Food Safety as she prepares to handle the ACC portfolio, replaced by Jo Goodhew. Minister for Primary Industries Nathan Guy will continue on in the role - a decision he said he was "thrilled" about.

Guy will look to build on what on what was really only a passable performance in his first term. He helped navigate some rocky roads with Fonterra in particular in the past 12 months, but had issues with meat exports to China and botched a high-profile attempt to lower the snapper catch limit.

Those two situations in particular showed a need to strengthen his political skills. This term is the opportunity to show a better performance.

Strength in the primary industries portfolio is essential for New Zealand to sustain a fast-growing economy.

For New Zealand to thrive in the coming three years, it will take some cunning, skill and probably a little bit of luck.

The strength of the dollar remains a hindrance to industry and the drop in global dairy prices will have to be addressed.

National have also set themselves the lofty goal of doubling the value of New Zealand's exports from $32 billion to $64 billion by 2025.

That means the top of Guy's mandate will be adding value to export products in the coming term and laying the foundation for compound growth in years to come.

Guy says that "we as government have a big role to play, but we can only do so much. The challenge will always be for industry to drive the wealth in the primary sector."

A big part of that equation from the Government's side will be securing improved market access for exports around the world.

Whether the Trans-Pacific Partnership opens doors in that regard remains to be seen, however recent progress -- or lack thereof -- has hardly engendered confidence that negotiations will wrap in the foreseeable future.

Guy's directive should be to get things right on the home front first and foremost. It seems that he would agree, saying that biosecurity will be his number one focus ahead, with irrigation following closely behind -- two factors he sees as crucial to improving our export potential.

"We will encourage more water storage projects for irrigation. We only collect and store about 2 per cent of rainwater that falls in New Zealand. We don't have a shortage of rain -- it just falls in the wrong places at the wrong time."

The Government has set aside $120 million for the Crown irrigation Investment fund, a figure which Guy says could rise as high as $400 million as part of a play to unlock an extra $4 billion for the economy.

However, the Government chooses to proceed on the irrigation front, making sure it goes hand in hand with an improved environmental footprint will be an important play -- from a publicity and sustainability standpoint.

While the Greens overplayed their hand in this regard at the election, guiding industry as they work towards more sustainable practices and a reduced impact on land will be a defining challenge for Guy in the coming years.

Guy says that he has "strong industry support". That could be tested if he is to make some of the hard decisions which are bound to arise as he attempts to navigate what is sure to be a challenging few years ahead.

• Fran O'Sullivan is a business columnist for the NZ Herald and Alexander Speirs (right) is a business journalist for Herald Business Reports