23 May 2002

Budget Gives Lift To Economic Development Initiatives

Today’s Budget will give more impetus to Industry New Zealand’s economic development initiatives, particularly those closely allied with promoting innovation, says Industry New Zealand Chief Executive Neil Mackay.

“Funding in the Budget delivers some tangible initiatives as part of the government’s Growth and Innovation Framework,” Mr Mackay said. “Industry New Zealand will have a vital role in delivering many of these initiatives.”

Examples include:

- The Budget lifts New Zealand’s game in attracting major new investment from overseas through foreign direct investment, as well as encouraging additional major investment domestically from international firms already located in New Zealand. Investment promotion will be co-ordinated and revitalised through the establishment of a new Investment New Zealand that will report directly to the Board of Industry NZ. The government is committing new resources of around $6.6 million in 2002/03 rising to more than $8 million in outyears for the attraction of major new investment

- Significant assistance for Industry NZ to support key sectors of the economy (including biotechnology, creative industries and Information and Communications Technology) with funding of around $7.6 million in 2002/03 rising to more than $9 million within the next few years. This reflects the increasing effort that will be required to successfully support this partnership with the private sector, and for the public sector to fully play its part.

- Funding has been approved for Industry NZ to support groups of small businesses to get together in business clusters. A well functioning cluster allows participants to utilise networks to achieve business objectives such as growth, cost reduction and related infrastructure development that they would not be able to achieve as effectively if acting in isolation. The Government’s framework for Growing an Innovative New Zealand has a significant focus on the value of partnership - between Government and the private sector, but also among businesses. Cluster development will receive $1 million each year from 2002 onwards.

- Funding of $2 million a year for the Fast Forward New Zealand programme, which aims to improve the effectiveness of existing government business assistance programmes by case management and strong inter-agency co-operation. It provides a single point of contact for businesses. Fast Forward is based on international best practice and will speed up the growth of New Zealand’s best and brightest companies and lift their export performance. Fast Forward is a partnership between the Fast Forward businesses and national agencies, regional agencies and private service providers.

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