7 December 2001 Speech Notes
Keynote Address To 19th Asian-Oceania Computing Industry Organisation Conference (ASOCIO) - Delhi, India
I am delighted to be here today at the 19th ASOCIO General Assembly & Symposium.
It is not often that a New Zealand IT and Communications Minister has the opportunity to address such a prestigious gathering.
There are two reasons why I join you today:
Firstly, since becoming a Minister, I have made it a priority to come here to find out what has made India a world leader in software engineering, and other information, communications and telecommunications skills.
Secondly, I want to explore with you the relationship between government and industry in an era when information communication technologies are driving great change.
These changes affect us all - they include globalisation, consumerism, the growth of trade, the dislocation of traditional industries and the development of knowledge economies.
Many of these phenomena are driven by the industry most of you represent - information and communications technology or ICT.
And ICT is itself undergoing massive change, in particular the digital convergence of computing, telecommunications, broadcasting, film, consumer electronics and the media.
And in turn that change has impacted upon jobs, communications, trade, health and education services - in short - the business of government.
So it is appropriate that the theme for this symposium is “government and industry, business in the digital economy.”
Today I want to explore two components of this theme -
- Firstly the key role of ICT in economic development, and
- Secondly the role of government in the digital economy.
The difference between New Zealand and some of the countries represented here today - particularly India - could not be more stark.
The country I represent is one of the smallest in the world. Our nearest neighbour of any size is Australia. New Zealand has close to 4 million people, and with such a small local market New Zealanders rely heavily on trade. We earn our living by selling overseas what we produce in New Zealand.
Here in India we are in one of the world’s largest countries which is at the centre of the most populous continent on the planet.
However, the point about new information communication technologies is that size and distance become less and less important as we become more interconnected.
I am sure that countries represented here recognise that future prosperity and economic growth lies in the transition to a knowledge economy.
But first, if delegates from other countries will bear with me, I want to talk a little about New Zealand and its relationship with India.
In the sporting arena both New Zealand and India have a passion for cricket, producing two of the best all-rounders the game of cricket has seen in Kapil Dev and Richard Hadlee.
Our passion for this sport is enhanced by ICT. The miracle of satellite technology and digital broadcast means that I can indulge my passion for test cricket on a year-round basis.
I know that the film industry is important in Asia and especially in India. If you have seen an Indian movie in the last few days there is a chance that what you saw was filmed in New Zealand.
The producers attracted, I guess, by our dramatic scenery, and by our sophisticated technical movie making expertise.
In the past few years over 70 Indian film crews have been to New Zealand, along with numerous Americans and Europeans. We have some of the world’s leading film technicians, and overseas film makers are not alone in using them.
In a few weeks time, one of the most anticipated western made films is to be released. The three part trilogy was directed by a New Zealander, shot in New Zealand and used state of the art IT - much of it developed in New Zealand - for its special effects. The total budget is over 400 million US$ making it the most expensive single film production ever. The film? The Lord of the Rings.
Impact of ICT Revolution
Which brings me to the first of my themes - the role of ICT in economic development.
Let me start by asking a fundamental question. How can New Zealand, India and other countries of Asia and the Pacific compete in a global market?
Let’s take the example of one of New Zealand’s Americas Cup boats.
Traditionally New Zealand was regarded as a great place for sailing, and indeed our sailors are regarded as world class. In the last decade or so New Zealand has also developed a world-beating boat design and building industry.
And a huge part of this success is based on the use of IT. It is not just that we are producing a world-beating boat, but what lies behind the boat is sophisticated software and powerful computers.
As a nation we have to apply knowledge to traditional skill and occupations. The result is innovation. Through innovation we can compete.
In New Zealand we see the future in such high tech high value industries. This means that you will begin to find New Zealand in the most unlikely places.
For the representatives from India here today, it might be the credit card in your wallet. It was probably made in New Zealand. A New Zealand company, Security Plastics has over 70% of the market share for credit cards in India.
But ICT is also crucial in maintaining the competitiveness of our traditional products. New Zealand logs can be bought and sold online via Woodnet - an electronic market for timber products.
New Zealand ports are installing IT systems that allow for much more efficient handling of cargo. More sophisticated communications allows for products to more closely match the requirements of customers. In all this the use of ICT is a common factor.
Ensuring continued competitiveness is an issue for all our governments. We recognise that we all have different approaches to this problem. Our strategy in New Zealand is two-fold.
Firstly we remain one of the most open economies in the world.
New Zealand is far away from most of its major markets and comes up against protectionism in markets and subsidisation of production and exports by other exporting countries.
New Zealand producers receive no subsidies whatsoever. They are exposed to foreign competition. This forces them to be smarter. Over 90% of New Zealand’s current applied duty rates are zero. Half of India’s exports to New Zealand, for example, attract duties of 1.1% or less.
In other words New Zealand is concentrating on the things that we do best.
Two-way trade is $US150 million and hopefully will be more as trade liberalisation policies take effect.
The second part of our strategy is directed at achieving economic transformation.
In the past New Zealand was known for the quality of our primary products - wool, meat, timber and so on - and for the beauty of our landscape.
In this context economic transformation means creating new value for these traditional products - branded cheeses, sophisticated cuts of meat, new varieties of apples.
But economic transformation also means encouraging the development of the new high tech industries I have been talking about, such as film, electronics, software, boat building and design, fashion, graphic design and biotechnology.
As a country dependent on agriculture, the biotechnology industry is an area where we are building on our existing expertise.
These industries form the basis of New Zealand’s growing knowledge economy.
Role of Government
I now want to turn to the role of government, which is clearly crucial in all of this.
The ICT market is one of rapid change and innovation. Our view in New Zealand is that ICT flourishes in an environment of minimal regulatory intervention and maximum competition.
Where regulation is necessary it should be transparent and technology neutral so as to allow for the entrepreneurial spirit to thrive.
By the same token, we believe that Governments have a role in building the knowledge economies of the future.
Specifically the government needs to ensure that both the hard and soft infrastructure supports these developments.
In New Zealand the Government has rolled its sleeves up and is working in partnership with business, tertiary institutions and communities to provide opportunities for all New Zealanders.
- Stimulating the venture capital market,
- Reforming tertiary education,
- Developing a science and innovation strategy,
- Providing support for business incubators
- Increasing the availability of skills through immigration
- Encouraging the rollout of broadband and
- Implementing our e-commerce and e-government strategies.
Collectively these initiatives underscore New Zealand’s commitment and determination to extensively enhance our future growth and prosperity through the utilisation of information and communication technologies.
Critical to the development of the knowledge economy is the development of e-commerce, or the ability for businesses to do business in a networked electronic environment.
Given that we believe that the private sector should take a leading role in all this, it was important for us in New Zealand to properly define the role of government.
The framework we developed is described in our E-commerce Strategy, which I released at the end of last year. The Strategy recognised the opportunities and risks for businesses as a result of the information technology revolution and set out the goals and principles to guide the Government's response.
We identified three broad roles for government:
- Leadership and communication, particularly e-government;
- Helping to build capability in business and the broader community; and
- Ensuring an enabling regulatory environment for e-commerce
I want to say a little about each of these roles.
We believe that the Government must lead by example. In this context the implementation of e-government is crucial. In New Zealand a very comprehensive E-government Strategy has been developed and implementation of this is progressing well.
Our goal is that by 2004 the Internet will be the dominant means of enabling ready access to government information, services and processes.
Already many key business dealings with government can be carried out electronically, including customs processes, tax returns, personal property security registrations and as shown here company registrations.
We also believe that Government has a key leadership role in communicating the importance of the changes that are taking place and their implications. To this end we have published information in hard copy and on the web, and have held a number of events in partnership with business that have showcased the opportunities.
Government also has a key role in building human and business capability. Lifelong learning is the key to wealth creation and improved economic and social performance.
The New Zealand Government is committed to:
- Building business e-commerce skills
- Working to ensure that all New Zealanders have access to life-long learning opportunities to develop ICT skills for the 21st century;
- And building broader ICT literacy and capability in the community
We believe that the private sector has a vital role to play alongside government and the tertiary sector in developing these skills, and I will talk more about this partnership in a minute.
An Enabling Regulatory Environment
The regulatory environment in part determines the incentives that support the early adoption of new technologies by business.
It is more than the legal framework. It embraces trade policy, tax policy, industry specific regulation, and consumer policy.
To date, our open trade and investment environment, quality urban telecommunications, and the banking sector have all been significant influences on the uptake of new technologies and e-commerce.
Businesses and consumers need to operate in an environment that is backed by adequate domestic and international legislation and self-regulation, to protect them from vandalism, fraud, theft, and misleading or deceptive trade practices.
Concerns about security are a significant factor influencing New Zealanders' willingness to embrace e-commerce.
New Zealand's Privacy Act is technology neutral and principle-based, and applies to the handling of all personal information collected or held by agencies, whether in the public or private sector. The privacy laws constitute a marketing advantage to New Zealand, as they provide best practice in protecting consumer and business information.
In addition the New Zealand Parliament is currently considering a raft of legislation to address issues in relation to:
- Electronic transactions
- Computer crime;
- And improving competition in telecommunications
Policy work is progressing on reform of our intellectual property laws and international coordination of law.
As an open economy, a key concept underlying the New Zealand government’s framework is that of partnership.
Our E-commerce Strategy emphasised the importance of partnership between government, business and the wider community. Leadership is identified as being the shared responsibility of government and business.
To advance this partnership the Government set up the E-commerce Action Team (ECAT) and the ECAT Network. Members of ECAT are drawn from key sector organisations, such as accountants, bankers, lawyers, farmers, tourism operators as well as the IT industry. Their mandate collectively and individually is to promote and identify initiatives to advance the uptake of e-commerce in all sectors.
Our broadband strategy is also being advanced in partnership with local interests.
And speaking of broadband, a major challenge for New Zealand is that New Zealanders want to live in places like this, but they also want to run successful businesses, many with an international component.
Broadband will allow them to have the best of both worlds.
To do this it is essential that the regions as well as the cities have access to affordable broadband services.
This is something that my government is currently focusing on. Our goal is that all New Zealand communities can access two-way high-speed Internet services by the end of 2003.
We are conducting some pilot programmes targeted at rural provincial New Zealand to hasten the roll out of broadband.
To finish, and to let you know that it is possible to have the best of both worlds, I want to talk to you about a small New Zealand business situated on the west coast of our South Island
Silk Road Adventures Ltd are niche market travel planners and ecotourism operators. Silk Road specialise in organising tours to the heartland countries of, believe it or not, Central Asia.
Silk Road is run by just a couple of people, but it is a multinational company.
Director Pat Reedy has contractors all round the world who help her to put together the tours, and this global partnering is made possible through the Internet and email.
On September 11th tours were running in Iran, Turkey, China and Pakistan. Pat was able to make immediate contact via email to each of the tours and provide clients with comments from family and friends about their safety.
The website also attracts international business. Recently Pat was contacted by someone in Hong Kong who wanted her to organise a tour to China. It is access to this kind of new business that the Internet makes possible, and that broadband access makes easy.
Ladies and gentlemen, I have attempted today to give you a glimpse of New Zealand and the issues that we are facing both within government and as a society.
Despite many obvious differences between our different countries - geographical location, climate, population - these issues and the solutions government can provide are in many cases the same.
We all want greater prosperity for our people and our businesses, and I think that in this room we are all convinced that ICT will do much to deliver this desired prosperity.