New Zealand Trade and Enterprise helped secure $2.9 billion in trade deals in 2022, exceeding the top end of its target range by 45%.
The crown agency had set a goal of $1.5b to $2b for the June 30 2022 financial year. The $2.9b figure exceeded the $2.3b achieved in 2021 by 26%.
NZTE’s 2022 annual report says North America recorded the highest deal total at $520 million, followed by East Asia with $400m.
The agency reported a rise in annual recurring revenue deals, driven by NZ companies increasingly offering software as a service and other subscription models.
NZTE received an extra $54m a year over four years in the 2020 budget as part of the government’s covid response and recovery fund.
That funding meant that NZTE could nearly double the number of its “focus” exporters – those receiving the most intense level of support – from 700 to 1,386 as at June 2022.
It also doubled the co-investment funding of its International Growth Fund (IGF) from $30m to $60m a year, aimed at those focus exporters.
NZTE’s total revenue for the June 2022 year was $299.9m including $206.5m in operating funding and $59.5m in crown grants. Total expenses were $320.3m with $59.5m of that spent on grants.
NZTE’s stated mission was to grow companies internationally for NZ’s benefit and to help diversify the economy to one that was high-wage and low emissions. It worked with more than 5,000 NZ export companies.
Following the pandemic, its medium goals have been to reconnect exporters with international markets and rebuild their businesses. NZTE had 43 offices overseas and 11 in NZ.
The NZTE had a target $4 return for every dollar invested by both businesses and the IGF, restricted to larger projects over a two- to three-year duration. The measured return for 2022 was $6.80 per dollar invested, 70% above the target.
It approved $68.6m of IGF grants in 2022 for 582 projects, up from the $60m budgeted for. Of those grants, $58.5m were expensed for the 2022 financial year.
The 1,386 focus companies had a total portfolio value of $58b as at June 2022. The agency had another 4,038 export companies on its books, as well as 324 Māori business clients.
The top five target markets for NZTE’s focus customers were the United States, Australia, China, the UK and Canada, and there were clients trading in another 100 or so overseas markets.
Over the past two financial years, NZTE reported it had experienced a “rapid increase” in technology clients. In the two top markets, the US and Australia, technology companies now made up the majority of the agency’s clients.
A source of revenue for NZTE was the NZ government-to-government (G2G) joint venture with the Ministry of Foreign Affairs and Trade, which acted as a conduit for foreign governments to use NZ public sector expertise. G2G also acted as an economic diplomacy tool for NZ.
The G2G scheme generated $8.1m in deals in the 2022 financial year. That fell short of the $14m target for the year, and the cumulative $21.4m earned from 2019-22 fell short of the $36m target for the period.
NZTE stated that the pandemic had caused G2G deals to move more slowly, and there were another 28 deals worth $41.5m in the pipeline.
The covid-delayed international expo in Dubai ran from October 2021 to March 2022 but retained its original name. NZTE reported that NZ’s contribution came in $4m under budget.
A total of 278 NZ companies took part, with 77 of those attending in person. There were 335 new introductions for NZTE client companies.
Total expenditure was $64.3m as at June 30, 2022, with further work to decommission the NZ pavilion due later that year. The final estimated spend for taking part in Expo 2020 was $65.3m.
More than $4m was returned to the crown from the expo budget.
NZTE extended support to Māori businesses both internationally and domestically. It helped Ngāti Toa complete a $352m deal with the Ministry of Education to buy back the land of 40 schools in the Wellington region. That deal made Ngāti Toa the ministry’s biggest landlord.
The agency was helping Ngāti Toa buy the land of a further 28 schools as part of the Ngāti Toa Rangatira Claims Settlement Act 2014.
It had also helped Te Whānau-ā-Apanui to raise almost $40m to fund the construction of a mussel factory in Te Kaha in the eastern Bay of Plenty.
