NZ's high-tech sector emerging as major contributor to US exports

Trade and Export Growth Minister Damien O'Connor. Photo / Mark Mitchell

New Zealand's emerging high-tech sector is becoming a major contributor in exports to the United States, according to a new economic report.

The report, released by the NZUS Council and titled The NZ-US trade relationship: stability and diversity in a time of change, revealed digital services contributed $682 million worth of exports to the US, spread across computer services and software license exports.

The report found New Zealand's primary sector remains the backbone of exports to the US.

The value of New Zealand's top 15 primary exports to the US was $2.96 billion in 2020, up from $1.51b in 1990.

Beef (boneless, frozen) remained the top primary export, as it was 32 years ago, accounting for $1.2b of overall primary exports (up from $816.5m in 1990). Beef (boneless, fresh/chilled) was $68.2m.

However, wine (still, bottled) was one of the biggest primary export movers over the past 32 years. Not featuring in the top 15 in 1990, wine accounted for $521.2m of primary exports in 2020 - the second highest product behind beef. Wine (bulk containers) was an additional $104.5m.

"New Zealand is a trading nation and supporting our country's hard-working exporters remains a priority for this Government," said Trade and Export Growth Minister Damien O'Connor. @It's crucial we show the diversification of high quality exports that New Zealand has to offer – and in doing so accelerate our economic recovery from Covid-19."

"The United States is New Zealand's third largest trading partner overall and it is now our largest destination for services – receiving over 22 per cent of our total service exports."

Overall, bilateral trade between the two countries was $17.6b as of the year ended September 2021. The relationship has grown steadily over the past 15 years, averaging more than 5 per cent. Pre-Covid bilateral trade was over $21b.

"It's clear that we're shifting up the value chain and away from a volume focus. American consumers are developing a taste for distinctive New Zealand primary products like wine and honey, which respectively earned $625m and $75m in 2020," O'Connor said.

"When it comes to our more traditional beef and sheep meat products, consumers are demanding a wider range of cuts. They're also becoming significantly more conscious of the health benefits of our food and environmental upside of our production systems as evidenced by the successful Taste Pure Nature campaign.

"Changes in our dairy exports complement the high-tech trend, where we're now seeing New Zealand dairy exports to the US diversified across a range of high-value specialised dairy products. These products range from high-quality whey protein to nutritional ingredients used in the sports, medical, and paediatric sectors.

"This report demonstrates that the US is a vibrant market that sees value in the widest range of services and goods that New Zealand proudly exports."