New Zealand’s economy needs to deepen and move away from relying on its food industries, says Xsol’s John Blackham, criticising the launch last week of the $700 million Fast Forward NZ fund.
Prime Minister Helen Clark announced new the fund, aimed at encouraging innovation in agriculture and food science, but Blackham says the decision displays a bias in the wrong direction and will further handicap our already struggling ICT industry.
ICT is already “suffering from a total lack of resources”, with not enough research and development being put into the industry, and fewer young people seeing it as a career option, he says.
“[Fast Forward] is not likely to make the situation any better.”
Blackham is presently involved in discussions on science policy with the Royal Society, New Zealand’s leading science body, part of whose brief is look at science’s role in society and industry. Blackham says he would have expected the Society to be informed about such a major policy move. “I was not aware anything like this was planned,” he says. Blackham is CEO of Xsol and a founder of the NZ Software Association.
“My concern is that neither [major political] party is taking a long-term view of the knowledge economy — the 21st-century economy.”
If we continue to rely on industries dependent on the weather and current habits in food consumption, then we are vulnerable if the climate changes or if people stop eating so much of what New Zealand produces, says Blackham.
“This move displays a weakness as far as broadening and deepening the economy goes. Most other countries have major [R&D] thrusts into the high-tech future and we’re lagging behind,” he says.
However, Professor Paul Callaghan, of Victoria University, Wellington, sees the fund a little more positively. The director of the School of Chemical and Physical Sciences replied to an email from Computerworld from California.
While warning that commenting on New Zealand affairs from a remote location was dangerous, he said: “I will say this, any increase in support for research and development is welcome, especially one which involves [the leading company in] our major industry, Fonterra, working in partnership with government. Clearly, adding value to our food products is an area where research effort can produce a pay-off.
“However, the present announcement appears to ignore a sector where New Zealand has shown extraordinary talent and potential: namely, the development of [electronic] platform technologies of the type so effectively turned into export dollars by companies like Rakon, Fisher & Paykel Healthcare and Tait Communications. These high-value, high-technology manufacturing businesses require no land, no energy inputs, emit no greenhouse gases and produce no negative environmental impacts. They suffer no trade barriers and no hostile protectionism in the form of ‘food miles’.
“If New Zealand had 200 of these companies, instead of the half-dozen or so we presently own, we would be richer than Australia,” wrote Callaghan.
“Nothing in this latest government initiative addresses the problem of how we drive the research platforms which will enable us to build another 200 such companies.”
Callaghan earlier underscored this position at lunch late last year organised by Computerworld’s sister publication, CIO. He talked about New Zealand seeing itself as a farm and a tourist theme-park. Callaghan displayed a telling triangular chart of international industry distribution between agriculture, manufacturing and services — New Zealand is still firmly in the agriculture corner, while other countries have moved to become more balanced economies.
“While the ‘Farm and Themepark’ are bedrocks of our economy, until we expand our high-technology businesses we will continue to drift down the OECD rankings of prosperity,” he says.
Paul Matthews, CEO of the NZ Computer Society, says that while he feels it is unwise to comment at length, given he has only recently become chief executive, he did say: “I could be cynical and consider this together with government’s lack of support for [industry umbrella group] ICT-NZ.”
Although the government has now agreed to contribute to funding a new ICT body, having seen a preliminary report on various industry organisations’ views of how to form such a body, “it still looks like herding cats,” he says.