The NZ economy moves from volume to value with Kiwi businesses, including SMEs, becoming more productive
This economic shift means:
- Building on our existing strengths and international connections to leverage new opportunities in domestic and international markets
- Investing in new technology and being at the forefront of digital innovation including to drive mitigation and adaptation to climate change
- Thriving and dynamic small, medium and large enterprises
Industry Transformation Plans
The Industry Strategy sets out the Government’s approach to lifting productivity, and improving the sustainability of our economy through Industry Transformation Plans (ITPs).
ITPs will bring a range of perspectives to the table to agree a vision for the industry with a strong focus on medium- to long-term transformation, and outline the actions required to realise the vision. They will seek to ensure that the sector can support the goals of the economic strategy for a more productive, sustainable and inclusive future for all New Zealanders.
ITPs will initially be developed for the following industries:
- Food and Beverage
- Wood Processing and Forestry
- Digital Technologies
- Creative Industries
- Renewable Energy
- Health Technologies
Research, Science and Innovation Strategy
The Government is developing a comprehensive strategy for harnessing research, science and innovation, in order to advance the wellbeing of all New Zealanders into the future. It will complement the Industry Strategy.
The Research, Science and Innovation Strategy will be released for consultation later this year.
R&D Tax Incentive and broader tax treatment of innovation
The Government is focussed on ways to enhance economic performance through new ideas, innovation and better ways of doing business. It is using the tax system to remove barriers to innovation. This includes:
- The introduction of the R&D Tax Incentive which provides eligible businesses with a tax credit of 15% on eligible expenditure between $50,000 and $120 million (and the ability for firms in loss to have their tax credit refunded);
- reviewing the tax treatment of spending on innovation, which covers feasibility and blackhole expenditure, or capital spending that is not otherwise deductible
Trade for All agenda
The Trade for All agenda is about ensuring our trade policy delivers for all New Zealanders including Māori, women, SMEs, and the regions.
It underpins our wider trade agenda and works alongside other government policies to support sustainable and inclusive economic development.
The Trade for All Advisory Board was appointed in December 2018 to provide an independent report to the Government with practical, implementable recommendations on how to make trade policy work for all New Zealanders. The Government expects to draw on the Board’s recommendations in 2020.
Small Business Strategy
Small businesses are an important part of the New Zealand economy. A Small Business Council was formed in 2018 for 12 months to provide advice on:
- a segmented definition for the small business sector
- a Small Business Strategy
- the ongoing purpose and functions of the Council beyond the initial 12-month appointment
- the establishment of a small business institute.
The Government expects to report back on the advice of the Council before the end of 2019.
Callaghan Innovation services and grants
Callaghan Innovation provides a range of innovation and research and development (R&D) services for businesses of all sizes. These include connecting people, opportunities and networks, and providing tailored technical solutions, skills and capability development programmes, and grants co-funding.
Callaghan Innovation also enhances the operation of New Zealand’s innovation ecosystem, working closely with government, Crown Research Institutes, and other organisations that help increase business investment in R&D and innovation.
Callaghan Innovation and NZTE also jointly fund the Regional Business Partner Network which helps NZ businesses innovate and grow by making it easier to access early stage business support.
Trade negotiations agenda
New Zealand is involved in the following active negotiations:
- EU – NZ FTA: (28 countries, 14% of NZ trade, launched June 2018)
- Regional Comprehensive Economic Partnership (RCEP): (15 countries, 59% of NZ goods and 52% NZ services exports, including India, launched November 2012)
- Pacific Alliance: (4 countries, including Colombia, launched June 2017)
- China FTA Upgrade (launched November 2016)
- ASEAN-Australia-New Zealand free trade agreement (AANZFTA) Upgrade: (12 countries, launched in May 2019)
- WTO E-commerce negotiations (involving over 80 WTO members, announced January 2019)
- Digital Economy Partnership Agreement (DEPA) with Chile and Singapore (launched May 2019).
Future of Work Tripartite Forum
The Tripartite Future of Work Forum (the Forum) is a partnership between the Government, Business New Zealand and the Council of Trade Unions (CTU).
The Forum aims to support New Zealand businesses and workers in meeting the challenges and take the opportunities presented in a rapidly changing world of work. The Forum provides a place for these three social partners to work together to identify issues and implement solutions. The Forum plans to publish a strategic assessment which will:
- assess evidence on how technological advancement, globalisation, demographic change and climate change are impacting on the labour market and nature of work in New Zealand;
- define the key challenges and opportunities that need to be addressed in New Zealand and help define Forum’s priorities.
The Forum intends to publish the Strategic Assessment in 2019.
NZTE customer focus programme
New Zealand Trade and Enterprise (NZTE) is New Zealand's international business development agency. Around 80% of NZTE’s efforts are focussed on working intensively with approximately 700 businesses (Focus700) that have the growth aspirations and ability to compete globally.
The Focus700 is currently weighted towards technology businesses, high-value food and beverage, Māori businesses, and specialised manufacturing companies, reflecting the Government’s commitment to move New Zealand’s economy to one that is increasingly diversified, sustainable, productive and inclusive.
Reforming government procurement
The Government has reformed its procurement rules to help leverage Government spending to deliver broader social, economic, cultural and environmental outcomes. This is in support of wider policy objectives, such as boosting New Zealand’s construction sector and reducing carbon emissions.
Changes focus on four priority outcome areas:
- Transitioning to a net-zero emissions economy and designing waste out of the system.
- Increasing the size and skills of the construction sector.
- Improving employment standards for vulnerable workers, and improving health and safety in high risk areas.
- Increasing access for New Zealand businesses, including Māori and Pacific businesses, and businesses in the regions.
Small business tax simplification
The government is focussed on developing ways to minimise the impact of the tax system. This includes minimising the compliance cost for businesses and lifting the economic performance of all businesses, especially smaller firms and the self-employed.