Export year launched - major boost for exporters
Rt Hon Helen Clark
Prime Minister
Rt Hon Winston
Peters
New Zealand First Leader
30 November 2006 Media Statement
Export year launched - major boost for exporters
Prime Minister Helen Clark today announced a $33.75
million boost to the Market Development Assistance Scheme
which supports New Zealand exporters breaking into offshore
markets.
This funding boost is a key feature of Export Year 2007, which is also being formally launched at the New Zealand Trade and Enterprise Export Awards tonight.
Helen Clark and Winston Peters said that Export Year 2007 is a key part of the confidence and supply agreement negotiated between Labour and New Zealand First.
Helen Clark, Winston Peters, Trade Minister Phil Goff, and Economic Development Minister Trevor Mallard today visited tapware manufacturer and exporter Methven Ltd’s Avondale premises to make announcements about initiatives for Export Year 2007.
"Improving our country’s export performance is critical for the future prosperity of all New Zealanders. For the economy to develop and transform, it is essential we have more globally competitive, high value firms and increase our export returns,” Helen Clark and Winston Peters said.
Helen Clark said a key part of Export Year 2007 is the one-off funding boost announced today to the Market Development Assistance Scheme.
“The funding will be spread over fifteen months from January. That means that support for the scheme will go from $27.1 million to $40.6 million in the 2006/07 financial year, and from $25.4 million to $45.6 million in 2007/8.
“This scheme is a vital component of our efforts to crack key markets overseas. It has already been very successful, and very popular, with about 320 firms currently receiving assistance.”
Helen Clark said the boost to the Market Development Assistance Scheme would enable many more businesses to use it to develop their export markets.
“The scheme has been heavily over-subscribed in both years of its operation. The 2006 funding round closed a month after it opened owing to excess demand, despite Budget 2006 providing extra funding of $19.8 million in 2006/07, and $14.8 million in outyears.”
Helen Clark and Winston Peters also launched the Export Year logo today, and the Export Year website www.exportyear.co.nz which provides information, how-to guides, checklists, and resources for exporters and which goes live today.
As part of the lead up to Export Year 2007, a conference in being held in Auckland tomorrow for the CEOs and founders of more than 50 export companies to brainstorm what the business sector can do to lift export performance. Other initiatives to be rolled out next year include:
- Targeted trade missions led by ministers.
- Beefing up the mentoring programme with people who have “real world” export experience to work with up-and-coming exporters and increasing access to exporter education courses.
Helen Clark said that Economic Development Minister Trevor Mallard and Trade Minister Phil Goff will be heavily involved in Export Year initiatives.
New Zealand First Leader Winston Peters said export growth was critical to New Zealand's long-term economic sustainability.
"As a country, we face two inconvenient truths when it comes to exporting. The first is that this is not a choice -- our exports must grow or our economy will falter. That means making structural and practical changes that will provide incentives for businesses to begin exporting, or to export more. We are confident that as Export Year 2007 unfolds, this will occur.
"The second is that this must be a long-term project. The initiatives and policies unveiled as part of Export Year 2007 must pay a dividend over the next decade and beyond. The success of Export Year 2007 will not be measured in 2008, but in a much stronger economy in 2017 that offers greater business profitability, higher wages, and better social services," Winston Peters said.
More information on Export Year and the Market Development Assistance Scheme is available in the attached questions and answers, and at www.exportyear.co.nz .
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Questions & Answers: Export Year 07
What is Export Year?
The government has
designated 2007 Export Year in line with its confidence and
supply agreement with New Zealand First.
Export year provides a focus on New Zealand exporters and the challenge New Zealand faces in improving its export performance and increasing exports as a percentage of GDP. It is focused on increasing New Zealand’s sustainable export base, through supporting both new and existing exporters.
Export Year 2007 will run through the duration of 2007, though many of the initiatives will go on beyond that.
What will happen
during Export Year?
The Export Year website
www.exportyear.co.nz provides information on Export Year
2007 initiatives, including links to other agency and
partner websites and their Export Year 2007 activities. To
date, Export Year 2007 initiatives include:
EVENTS
- A
conference for the CEOs and founders of more than 50 export
companies to brainstorm what the business sector can do to
lift export performance.
- New Thinking Week in March.
This is a NZTE initiative that includes private sector
partners.
- Export breakfasts throughout the country run
by Export New Zealand and NZTE.
- Export focused events
and forums by chambers of commerce, economic development
agencies, commercial banks, and others throughout the
country.
- The NZTE Export Awards in
2007.
EDUCATION
- The development of export focused
resources for use in primary and secondary schools from term
one of 2007.
- Beefing up the mentoring programme with
people who have “real world” export experience to work
with up-and-coming exporters
- Increased access to
exporter education courses.
- Scoping the potential for
developing a tertiary export diploma.
INFORMATION
- A
dedicated website www.exportyear.co.nz to provide
information, how-to guides, checklists and resources for
exporters
- Preliminary work by New Zealand Customs on
developing a portal to enable exporters to find and process
all their documentation online.
- A communications
campaign targeted at business to raise their aspirations and
inform them about events, resources and assistance that will
help increase their exports.
OFFSHORE ASSISTANCE
- A
$33.75 million increase in the market development assistance
scheme (also known as the market component of the Enterprise
Development Grant programme), spread over the 15 months to
March 2008.
- Investigating extending NZ Trade and
Enterprise’s presence in Asia, including potential
extension of the Beachheads programme and Focus
Centres;
- Targeted trade missions led by Ministers and
the Prime Minister.
- Expansion of NZTE’s Path To
Market pilot programme that supports new exporters into
Australia.
POLICY
- Ongoing review of business taxes,
including the possibility of a tax credit for market
development.
- Finalising a revised Tourism strategy for
New Zealand.
- Reviewing Government strategy to get more
value out of international education opportunities.
- A
new trade strategy for New Zealand’s after the Doha round
of trade negotiations.
What private/public sector agencies
are involved?
A Private Sector Reference Group has been
established to advise the government agencies and includes
Business NZ, Export NZ, Economic Development Association NZ,
Employers and Manufacturers Association (Northern) Inc, NZ
Council of Trade Unions, NZ Pacific Business Council,
Auckland Chamber of Commerce, Canterbury Employers’
Chamber of Commerce, Wellington Chamber of Commerce
Ken Stevens, Executive Chairman of Glidepath, has been appointed as Export Year Business Champion. The key government agencies are Ministry of Foreign Affairs and Trade, Ministry of Economic Development and New Zealand Trade and Enterprise.
Questions and Answers: Expansion of Market Development Assistance Scheme
What is the Market
Development Assistance Scheme?
The market development
assistance scheme is also known as the Market Development
Component of the Enterprise Development Grant. The scheme is
delivered by New Zealand Trade and Enterprise. As a result
of the extra funding, annual funding for this scheme will
increase from $27.107 million to $40.607 million for
2006-07, and from $25.351 million to $45.601 million for
2007-2008. From 2008-09 annual funding will be $27.6
million a year.
The scheme is aimed at encouraging the integration of more New Zealand businesses into global markets through market development projects.
Improving
international linkages in this way can benefit a small
economy as it:
- helps firms access new markets and take
advantage of new opportunities
- allows firms to develop
market niches and exploit economies of scale
- exposes
firms to international competitive pressure, ideas,
knowledge and technology that drive innovation and
productivity improvements
- provides firms access to
global production networks, which can act as conduits for
the transfer of knowledge, technologies, skilled labour,
foreign direct investment and work and management
practices
- builds management capability through
experience gained in operating in global markets.
For more information see www.nzte.govt.nz/edg
How does the grant
work?
It provides financial assistance for eligible New
Zealand businesses to undertake new international market
development activity or market development in a new market.
The scheme covers up to 50 percent of a firm’s eligible market development expenditure. Eligible projects and costs include market visits, in-market representation, advertising/promotion/marketing materials, exhibiting at trade fairs and events, and market research.
To be eligible, there must be a proposed change in the current business model – eg a change of geographical market, client base, product line, distribution/partner channels or marketing mix. The strategy needs to be aimed at significantly improving the business situation of the applicant, and achieving an increase in revenue growth.
What companies are eligible for the scheme?
Currently,
firms need to be registered in New Zealand for tax purposes
with annual turnover of no more than $50 million. Firms
must also demonstrate that they are committed to and capable
of undertaking significant and sustainable market
development activity.
Firms with turnover greater than $50 million can access the fund if they collaborate to help the smaller firms undertake sustainable market development activity.
How much funding can applicants apply
for?
The Export Year funding is spread over 15 months
from 1 January 2007. Companies applying to this pool will be
able to apply for one-off funding of up to $100,000 in
eligible costs for the 12-month period from which the
funding is granted. As a minimum, the smallest amount a firm
in the scheme must spend on its market access activities is
$40,000 – of which $20,000 may be reimbursed by NZTE under
this scheme.
When can firms apply for a grant under the
expanded scheme?
From December 1 firms will be able to
register their interest in the scheme and request an
application form from NZTE’s website
(www.nzte.govt.nz/edg).
Applications will be accepted from 1 February, 2007 and approved from 1 March. This will give firms time to start identifying market development opportunities and to prepare their application forms.
ENDS