Tech sector's value tipped to outstrip tourism by 2020

Green Party ICT spokesperson urges government to give more support to local ICT industry

Official figures showing that spending on hi-tech goods and services rose $3 billion to almost $23 billion in the past two years unleashed a wave of industry breast-beating and political sniping.

Candace Kinser, chief executive of information technology industry body NZICT, says the figures suggested the technology sector would contribute more to the economy than either tourism or dairying within seven years.

Green Party ICT spokesperson Gareth Hughes says they showed the ICT industry "deserved more government support" in the form of procurement policies that favoured local suppliers. He complained that an Australian firm had been used to build the website that lets people pre-register for Mighty River Power shares.

New Zealand's ICT sector had huge potential, he says. "It's very disappointing to see government contracts like Novopay and the Mighty River Power website heading offshore when there are companies here that are perfectly capable of doing the work."

Speaking at a conference organised by Gen-i in Wellington, ICT Minister Amy Adams said businesses had been a little slow to wake up to the opportunities.

"We have the ninth highest internet usage per capita in the world. We have 80 per cent of New Zealanders saying they buy online, but about 30 per cent of New Zealand businesses do not have an online presence."

Statistics NZ's ICT manager Hamish Hill says: "Each time we've run this survey, we've had to include more businesses from increasingly diverse industries."

Businesses made $5.8 billion in computer and phone sales in the 2012 year, $800 million more than two years ago.

Sales of internet connections also rose sharply, up 44 per cent to $1.3 billion.

"Some of this may appear contrary to expectations, since the cost of many of these hi-tech goods has gone down over the same period," Hill says. "The fact is, more people are buying these items and getting connected. They have become a necessary part of life."

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"Green Party ICT spokesperson Gareth Hughes says they showed the ICT industry "deserved more government support" in the form of procurement policies that favoured local suppliers."

Ok, so let's spend tax money on local "suppliers". Great idea. Except: Many of them supply goods (and in some cases services) that originate off shore anyway. Plus it's not really helping the economy to spend internally raised money on internal organisations in this way as there is a risk that they become so consumed with servicing government that they then lack the capacity to earn money from offshore.

A MUCH better approach would surely be to provide grants, as well as other forms of aid, to local companies in essence as investment in their business, with the express aim of attracting overseas interest in purchasing the products and services they provide. In this way, the government would be helping locals to export tech, thereby improving the balance of trade defecit, and ensuring that our export economy is more diverse than simply pushing dairy products off shore.



Someone bring back Maurice Williamson for god's sake...



Someone needs to point out that NZ has 9 free trade agreements. The agreements work both ways, not only can NZ local firms compete in their countries, they can compete in ours, with no favoritism.

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