EDANZ - A Postscript

Tonight, I attended a Priority One members' night here in Tauranga. Approximately 100 other local Western Bay businesses attended.

The guest speaker was Bevan Graham, Chief Executive of EDANZ (Economic Development Association of New Zealand). I left neither convinced nor particularly optimistic.

Bevan was clearly targeting his message at an EDA constituency. So to that extent, I can understand the focus of some of his arguments. I disagreed though with some of the basic assumptions and even more so, with some of his (non) solutions.

Bevan argued that New Zealand lacked enough entrepreneurs (agree), but had access to enough capital (strongly disagree). If you want to acquire a property-based and therefore secured asset in NZ, then finance is available. If you want to fund overseas expansion with an intangible asset (i.e. software), then capital becomes either scarce or expensive - or non existent. Why do NZTE and Investment NZ retain Representatives in the main overseas capital markets to attract inward investment into NZ businesses if this was not the case?

Bevan suggested that the Ireland model did not apply here. New Zealand might not have a 300 million person market next door, but a 12.5% corporation tax rate and generous tax incentives in the form of tax and investment reliefs would prove very attractive to inward investors. My own understanding and appreciation of the Irish model, in the global market, differs somewhat from Bevan's.

Bevan talked about a disconnected public sector that saw Government departments failing to coordinate and therefore duplicate actions (agree). One things that does amaze me about a country (NZ), the size of the West Midlands (that's Birmingham, UK and surrounding districts), is that the country (NZ) can have so much government.

And that brings me to EDANZ. Over 60 EDANZ branches exist throughout New Zealand's regions, ranging from the large to the minute. Some are council managed; some are not. Some have one method of governance; others another. Some seem to survive simply by basing their business focus on current public sector objectives, and therefore grants. Others, well they just survive. And most compete at a local level with other business interests for both influence and dollars.

What tonight's presentation lacked was a focus on offshore engagement. It therefore focused on all the negatives that make up a lot of the NZ business mindset. Our size (we are mostly minute), our ambition (most of us really strive for the 3B business exit), our distance to market and wait for it, our unique NZ character.

The fact that overseas engagement with offshore EDA'S or industries built around similar BOP Clusters might benefit NZ regions, simply did not register.

And that's why tonight's presentation was not just not that convincing, it was actually quite depressing. It focused on the mindset that New Zealand can address its problems by adopting an NZ solution. A sort of 'No 8 wire, but let's make it 9' so we are a little different from our parent's rural generation.

NZ business has to wake up to the realities of the global market. It is here, it is setting the rules and NZ business needs to engage.