1 Business- Government Partnership For Innovation and International Competitiveness : The New Zealand Story since 1999 Nigel Haworth The University of Auckland CONFIEP Seminar “Experiencias Internacionales de Promoción del la Innovación” Lima, 3 September 2008

2 Background Project ECLAC project on "Public-Private Alliances for Strategic Export Development”

3 New Zealand Cohesive, modern, democratic, stable society Geographically remote, at the end of supply chains and trade routes Small, relatively urbanised, highly-educated, globally-orientated population (4.2 million)

4 New Zealand: the economy Open to FDI; committed to WTO About 350,000 enterprises – easy to form – Most small, high rates of formation/closure Growth: averaging 3%+ over recent years Unemployment very low: 3-4% in recent years Productivity (especially MFP) poor Wages relatively low R&D performance poor (50% OECD average; private sector less than 50% R&D spend)

5 Post 1999 Vision: Integrated Economic Transformation 1999: rejection of market fundamentalism – Impact of path dependency Vision: Economic Transformation – Growing globally competitive firms – A world class infrastructure – Innovative and productive workplaces – Environmental sustainability – Auckland: an internationally-competitive city Key supporting factors: – Sustainable through electoral cycle – Social inclusion – Committed stakeholders Goal: to regain top half of OECD

6 Economic transformation: R&D and Innovation Strong fundamentals Improved, better resourced, better focused policy: R&D framework Innovation at company and sector levels Priority sectors (esp. biotech, ICT, Cultural Industries) Improved funding Focus on the relevant and the commercial

7 Economic transformation: improved workplace productivity Employment relations framework legislation focused on partnership and productivity Stakeholder-driven initiatives in: Workplace productivity improvement Employer-trades union partnership Supported by: New qualifications framework in compulsory education Growth (numbers and funding) in tertiary education Renewed focus on skill training (including numeracy and literacy)

8 Economic transformation: global connectedness New Zealand Trade and Enterprise: ‘one stop shop’ Regional business development Industry initiatives Company initiatives Internationalisation programmes Supported by: Strong commitment to WTO, APEC etc NZ diplomatic focus on trade advantage

9 Economic transformation: public- private partnerships Sustained commitment to stakeholder engagement especially with business Tripartism Both vision and implementation: Foundations of economic transformation Board level leadership and membership Task forces, consultative measures Access to ministers Example: Growth and Innovation Advisory Board (GIAB)

10 Economic transformation: Implementation Leadership at top political level (Prime Minister) Committee of main ministers driving process ‘Whole of Government’ approach High quality, technically competent public service Monitoring of policy by Treasury, Department of Prime Minister and Cabinet, PM’s own office

11 Economic transformation: Principles of Government Support Emphasis on – Support and facilitation, not direction – Targeting (e.g.) Prioritised sectors, High-end, high value-add, high-tech International potentia SMEs – Capability building important – Applied, relevant outcomes

12 Economic Transformation: Principles of Support contd. – Part user-pays (e.g. 50% model) – accountability – Competitive tendering (e.g. for research funds) – Wide range of support limits from $5k to multi- million – Partnerships/collaborations encouraged

13 Economic Transformation:Evaluation Of vision (ministers and stakeholders e.g. Growth and Innovation Advisory Board) Of implementation Of agencies (e.g. By Ministers, Treasury, DPMC, other ministries, GIAB) Of schemes By delivery agencies (including private sector) By monitoring agencies

14 Overall current performance (2007)