Each week Stuff asks New Zealand’s business and community leaders how they think the economy is going, and what they believe are the biggest challenges.
Todd Dawson is chief executive of NZX-listed Napier Port, New Zealand’s fourth-largest port by container volume and third-largest by log export volume.
Dawson says last year highlighted the resilience of the rural and primary sector, but he is concerned about the challenges facing businesses such as labour shortages and rising costs.
“People will see their purchasing power falling and that is going to be tough. It will also weigh on perceptions of our economic performance.”
READ MORE:
* Monitor economy Q&A: Simon Limmer, chief executive of Silver Fern Farms
* Monitor economy Q&A: Dion Tuuta, chair of Parininihi ki Waitotara Incorporation
* The Monitor economy Q&A: Serko chief executive Darrin Grafton
How do you feel the New Zealand economy is tracking currently?
Our rural and regionally based primary sector industries are doing remarkably well. They remain New Zealand’s most productive and resilient source of national income.
International demand for high value primary products just keeps growing and this has taken up the slack left by other major income sources such as international tourism, education, energy exploration and foreign investment.
SUPPLIED
Providing jobs for people and creating wealth through productivity are the biggest challenges facing NZ, says Napier Port chief executive Todd Dawson.
But I cannot help thinking about the huge opportunities we have lost over the last couple of years due to the sharp decline in these sectors, lost sales, cancelled events, constraints we see on foreign investment or projects shelved because of uncertainty or weak business confidence.
What are you most concerned about right now?
The vast majority of what we produce goes to international markets. With the border opening up New Zealand businesses will rightly be prioritising getting back in front of their customers, reconnecting and building relationships, and opening up supply chains.
A key challenge before us is reminding global markets that we are an attractive country to do business with and that we are a smart population with great products and clever solutions.
There are also real challenges for businesses around costs, increasing debt, rising interest rates and labour shortages, all of which are weighing on business confidence and their appetite to invest.
Businesses need to be supported as they adapt to this new environment, with the removal of obstacles that are exacerbating these pressures including, improving access to labour and reducing the ever-growing burden of compliance. We need to focus on making it easy to run or start businesses in New Zealand and doing all we can to maintain our global competitiveness.
What has the last year taught us about the New Zealand economy?
It’s reinforced understanding about the resilience of the primary sector and that we are a trade-oriented economy.
With 90 per cent of all imports and exports requiring access to sea freight, this year has highlighted the importance of building supply chains that reach deep into the countryside and ensuring efficient and cost-effective connections with trade gateways such as Napier Port.
We need to grasp the opportunities to co-ordinate infrastructure design and more effectively manage the spend across road, rail and ports, and improve transport links into ports. These opportunities hold out the significant potential for importers and exporters to drive efficiencies and cut costs, waste and duplication. In turn, this ensures our future competitiveness and the connections with global markets that underpin our economy.
The Government has rightly prioritised public health, however some of the measures have sparked a backlash from businesses who rightly argue for the speedy removal of barriers that are limiting trade. That aside, this year has shown that collaboration between the private and public sectors should continue, and business has a lot to offer central government in looking at pragmatic ways of getting things done on the ground.
Are you optimistic or pessimistic about the economy this year? Why?
I’m optimistic because we have a highly productive primary sector, and we have a lot of what the world wants in terms of products and services. We’re an entrepreneurial, innovative country that is good at overcoming problems, and we have a lifestyle and environment that is the envy of many.
I’m most excited about our businesses getting back in front of the world and – at Napier Port – doing our part to enable this. Because ultimately, its businesses who earn the country its income and allow us to pay for the lifestyle we want.
I am realistic however that rising inflation and the escalating cost of living and doing business represents a real challenge in the year ahead. People will see their purchasing power falling and that is going to be tough. It will also weigh on perceptions of our economic performance.
What is the biggest challenge facing New Zealand?
Providing jobs and opportunities for people and creating wealth for New Zealand through productivity. We need to focus on ensuring we have the right people, skills, and technologies to create an environment where businesses have the confidence and appetite to invest.
The last year has also shown that good infrastructure is fundamental to the New Zealand way of life. We have immense opportunities to improve the co-ordination and long-term planning of infrastructure including how we fund necessary investment.
We need to improve engagement between central government and industry and cargo owners in the design of the national road and rail network.
We also need to improve the design of port, road and rail connections to ensure a seamless flow of cargo across different transport modes.
The Monitor is Stuff’s unique set of insights to help the business community better understand the economic landscape, and maximise their success. Alongside the quarterly snapshot is an economic index showing the speed of growth across different parts of the economy.
