Media release from:

Hon Jim Anderton Minister for Economic, Regional and Industry Development Progressive Leader

15 March 2004

Creativity and innovation tranforming New Zealand into high wage, high skill economy

Economic development, using creativity and innovation is transforming New Zealand into a high wage, high skill economy said Jim Anderton today in a speech to the EDANZ (Economic Development Association of New Zealand) conference in Wellington.

"Edanz and economic development organisations from all over the country are integral to the transformation of our economy from a commodity-based economy to a job-rich, high-wage, high skill economy producing high value products.

"New Zealand is a small country that cannot grow or produce enough commodities to raise the living standards of all New Zealanders. What other countries can achieve economically by their scale, concentration and proximity to markets, New Zealand needs to achieve using innovation and creativity - such as was used in Lord of the Rings and the high value NZ pine furniture which will be made by Denmark's Zenia House.

"The time couldn't be better to build on our creativity and use our links with the rest of the world to build on our innovative business ideas.

"Our challenge is to create a New Zealand whose economic and social future is based on our ability to think and to use our intellectual property to build both a growing economy and a fairer society.

"We must meet this challenge, not only for present and future generations of New Zealanders, but also for a world which desperately needs the ability and capacity to nurture and care for all of its citizens.

"These are objectives worthy of our time, effort and ingenuity. I am confident we can succeed," said Jim Anderton

---------------------------------

Full speech notes follow

Hon Jim Anderton: EDANZ conference keynote address.

In his speech to the EDANZ (Economic Development Association of NZ) conference, Jim Anderton talks about how innovation and creativity are contributing to transforming NZ into a high wage, high skill economy.

EDANZ conference Monday, 15 March 2004.

SPEECH NOTES

- EDANZ director Ann Verboeket
- EDANZ chair Tony Rush

Welcome delegates from around New Zealand and welcome to our overseas guests.
- David Bergman from the USA
- Stewart Cunningham and Jock McQueenie from Australia
- Dr Ian Foster an ex-pat Kiwi from Christchurch, currently at Argonne National Labs at the University of Chicago and co founder of the Globus Project.

One of the most influential people in the world in economic development right now is Richard Florida.
- He is Professor of economic development at Carnegie Mellon University in Pittsburgh, Pennsylvania. (Sounds like a song I used to sing - Guy Mitchell! - shows how old I am!)
- Many of you will have heard Professor Florida last year when he came to New Zealand to speak on his theory of the rise of what he terms the 'creative class'.

In an article in the latest Washington Monthly magazine, Professor Florida featured Wellington among a group of cities attracting creative industries and providing competition for similar centres in the US.
- The beginning of his article focuses on Peter Jackson's leading role in the development of the film industry in Wellington.
- It shows how such initiatives can lead to the formation of new companies and, potentially, new industries, nation-wide.
- Besides Wellington the author includes Vancouver, Brussels, Sydney and Dublin.

This conference theme stresses the importance of creativity.
- It's been four years since I first came to an EDANZ conference and stressed the importance of unleashing the creative power of New Zealanders.

Today you have heard many tangible examples of New Zealanders harnessing creativity to achieve business success.
- They are examples of the transformation of our economy from a commodity-based economy to a job-rich, high-wage, high skill economy producing high value products.

New Zealand cannot grow or produce enough commodities to increase the incomes of New Zealanders.
- New Zealand is a small country.
- What other countries can achieve economically by their scale, concentration and proximity to markets, New Zealand needs to achieve by innovation and creativity.
- We need to collaborate in global partnerships.

Today I would like to focus closely on how the government sees the connection between creativity and economic, industry and regional development.

Three industries have been identified as top priorities to drive innovation and become sources of competitive advantage.
- They are information communication and technology (ICT), biotechnology, and the creative industries - fashion, design, film and music.

These industries can deliver powerful export products for New Zealand in their own right.
- But more importantly they also act as enablers for other industries - helping to push them up the value chain.
- They are not, of course, the only three vital industries for development, by any means.
- But they are very important because they have the greatest potential for the quickest return - both in the growth of the particular industries and in their contribution to other industries.

Industry taskforces in all these sectors were established and made recommendations about unleashing the potential of each industry.

In the design area for example, the design taskforce reflected on New Zealand's under-utilisation of design and creativity.
- It targeted our low appreciation of the value of design and the value of creativity.
- This desperately needed to be addressed - why would people employ design if they didn't see its value?
- Therefore the government has announced support for a major four-year programme.
- It will enable New Zealand business to improve product and communications design.

If we can harness creative talent in a way that produces better design, then we are some of the way towards selling more high value products to the world.

Design is a crucial component in differentiating products in the world.
- Undifferentiated commodity products (wool, meat, logs, butter, fish) can never command a premium.
- An economy based on the sale of undifferentiated commodities is never secure.
- There is always someone else who can sell the same stuff.
- No matter how efficient we are, sooner or later someone will be cheaper.

Design is different - no one else can copy it.
- Distinctively New Zealand design can only ever be produced in New Zealand.
- It is therefore a more secure base for our economy, provided we can develop markets for it.
- Then, design will produce rising living standards and higher incomes for everyone.

The Design Leadership Strategy has been produced to achieve real results that help to transform our economy.
- A board of leading designers, educators and businesspeople will be appointed to a Design Leadership Group.
- Over the next few months New Zealand Trade and Enterprise will introduce a series of design based programmes.
- They will help companies to utilise design in order to improve products and services.

The programme includes a significant communications programme.
- It will aim to increase awareness of the value of design - both for businesses and for New Zealand.
- It will help to promote a culture of creativity.
- If the programme is successful more businesses will use design to lift the value of their production.

More than that, the government wants to see ideas spread out across industries.
- So a business switched on to the value of creativity will pick up other tools to promote innovation.
- Industries will better see the connections between their own innovation and opportunities to lift the value of New Zealand's production overall.

It will also encourage companies to seek creative and collaborative business ventures.
- The government wants to see more participation in global value chains, and more international partnerships.
- That is, we want to see well-designed business relationships.

We want all New Zealanders to know what Jeremy Moon - of the innovative merino apparel company Icebreaker, means, when he says: Design is at the core of everything we do. It's how we think. It's not an add-on or component, it's in the blood of our business.'

Design is important to a company like Icebreaker, from the product to the way production is structured, to sourcing its materials to commercial partnerships.

I would like to outline two other recent examples of the benefits of design and creativity in the transformation of New Zealand's industrial base.

One is the wood processing industry.
- New Zealand has significant volumes of wood and forests.
- But maximising return from them requires more than logs.
- It will come from high value products like furniture.
- The greater the intensity of production in New Zealand, the higher the financial returns.

When some research was done last year, it showed the international furniture market had little knowledge of New Zealand pine.
- It showed that there is only a fledgling furniture design industry in New Zealand.

One solution was to find European designers and get them to use processed New Zealand wood in their furniture ranges.
- Recently the Government was able to announce the success of the Zenia House partnership.
- This significant venture moved one of our wood producers, Fletchers, up the value chain, further away from supplying a simple commodity.
- It positioned the raw material - pine -- as a value-added premium and branded product.
- It also raised the visibility of New Zealand Pine as a furniture material.

There are many other steps, as well.
- We need to stimulate New Zealand design.
- I have recently opened an exhibition of outstanding furniture design using New Zealand pine [Metaform].
- By positioning New Zealand pine design in art galleries, it increases the value of a material in which we are rich.
- It also stimulates creative thinking among designers, potentially developing career choices and opportunities.

The other example of creativity in industry at its best is The Lord of the Rings.
- The Lord of the Rings has tended to be seen as an aberration in the context of the role creative industries play in New Zealand.
- It should however be seen as a pathfinder and model for the future.

The Oscars (and box office) success of The Lord of the Rings is great for the screen industry in New Zealand.
- But it also helps to position New Zealand as an innovative, technologically advanced, creative country with beautiful scenery.

The Lord of the Rings project is the benchmark for an integrated, globally-connected New Zealand screen industry.
- It used foreign capital to stimulate a technology rich, high value industry here.
- It also show-cased both New Zealand talent, and unique physical assets to the world.

The Lord of the Rings launched new technologies and practices on an unprecedented scale.
- It has also significantly increased tourism and demonstrated New Zealand's future as a tourist destination lies in added-value experience-based tourism.
- It shows outstanding locations and landscapes can be enhanced by imaginative experiences that increase value and revenue.

The Wellington region benefited considerably.
- An innovative sound stage is being built at Miramar by Camperdown and Wellington local bodies - with the financial assistance of a Major regional Initiative funding totalling $2 million.

The Lord of the Rings has also done an amazing thing - it has made New Zealanders proud of New Zealand's creativity.
- It has illuminated the power of creativity for New Zealand businesses.

Its twenty seven Oscars won across eleven award categories have also shown the rest of the world that New Zealand can compete with the best creative people in the world.
- It has shown that New Zealand can make a creative business work and that this creative arts industry can be a valuable source of business partnerships.
- Leading writer John Howkins wrote 'people who own ideas have become more powerful than people who work machines and in many cases, more powerful than people who own machines'.

The time couldn't be better to build on our creativity and use our links with the rest of the world to build on our innovative business ideas.

Our challenge is to create a New Zealand whose economic and social future is based on our ability to think and to use our intellectual property to build both a growing economy and a fairer society.

We must meet this challenge, not only for present and future generations of New Zealanders, but also for a world which desperately needs the ability and capacity to nurture and care for all of its citizens.

These are objectives worthy of our time, effort and ingenuity. I am confident we can succeed.

ENDS

© Scoop Media