Our micro-initiatives show economic way
New Zealand agriculture seems to have moved beyond talk of great trade opportunities in Asia to executing ways of making the most of them.
ANZ chief economist Cameron Bagrie said the agriculture sector had experienced a change of attitude.
‘‘There has been a big change in the tenor of conversations between now and three years ago.
‘‘Three years ago we were talking about opportunity. Now there are a lot more thought leadership forums around the country that are centred around execution and how we unlock those gains. Those sort of shifts are subtle but they are very important as they signal where New Zealand is moving to.’’
In 10 years New Zealand could have access to a market of 4 billion people through free trade agreements. Growing populations in Asia were becoming wealthier and creating a powerful demand for protein with potential for more free trade.
New Zealand could not feed all of Asia, perhaps only 30 to 40 million people, but other countries were going to enter the high value market.
‘‘Whether China grows at zero per cent or 10 per cent is not going to make much of a difference to New Zealand because we are small and we are tinpot,’’ said Bagrie.
‘‘We are not going to be feeding that market en masse, we are going to be feeding them in select groups.
So what we are interested in at the moment is: What are the strategies people are putting up? ‘‘What is the execution? How are we going to benchmark those?’’
Bagrie said he was looking at micro-economic evidence that New Zealand was taking its story to Asia to take advantage of opportunities.
Small initiatives such as board compositions, brandstyle strategies over volume-style and work by the education fraternity – showed progress being made.
‘‘A couple of months ago Fonterra announced someone of Asian descent was going to be on their board. Individually it doesn’t mean very much but what does that tell me – that they are deadset on understanding the final end consumer. So I take those micro economic initiatives as tremendously encouraging.’’ Globally the economic picture remained ‘‘wobbly’’ with Europe still a mess, the currency still too high and volatility the norm.
Farmers needed to focus on the things they could influence on the farm and the big companies on brand marketing.
Bagrie said the bank was also trying to maximise opportunities by taking clients to Asia – India, Vietnam, China – and meeting people in the marketplace.
– ANZ chief economist Cameron Bagrie