In an online address to the ANZ-Kanganews New Zealand Capital Markets forum this morning, Gluckman said the country needs to update its economic strategy to both capitalise on its food story and also focus on the “weightless economy” in the wake of covid-19.
Adding the country needs to make necessary changes now “rather than to have changes effectively imposed on us through a sudden loss of markets with environmentally conscious trading partners.”
He said the nation’s highest income producers – tourism, export education and agriculture – were all threatened by long term challenges and it was “unrealistic to return to a pre-covid business as usual mindset.”
Gluckman, director at the University of Auckland’s apolitical think tank Koi Tu, believes the pandemic could hasten the move globally to online learning, which may over time limit NZ’s long-term export education opportunities.
In that context, NZ’s “most important asset will be knowledge and the weightless economy,” he said.
Yet building this asset will require new strategies and much more than the rather limited efforts made by successive governments.
With cities the “hubs of innovation” attract and retain people and capital; Auckland must be able to compete with Melbourne, Sydney, Singapore and London, he said.
While the innovation sector is growing fast, scaling up is much harder and businesses are yet to reach a “critical mass” of labour and capital, creating enough capacity to market globally and earn at scale.
That means working harder to take advantage of NZ’s reputation and help it attract entrepreneurial activity.
Universities would play a central role in that, both in the creation of new ideas and processes and in creating the “next-generation” workforce, Gluckman said.
“World-ranked universities act as magnets for talent and private industry. Silicon Valley would not exist without Stanford University. Efforts must be made to have at least one globally high-ranked university here,” he said.
He believes covid-19 has created an incentive to “rethink our path ahead” and to find ways to discuss the complex issues and appreciate the trade-offs involved.
“How can we sustain and transform our economy in ways that allow our social and environmental futures to flourish?” he asked.
“Any shift will take time and needs a coordinated strategy agreed across many sectors of government and society.”
Too many issues remained in the “too hard basket,” such as trans-generational disadvantage, NZ’s bi-cultural and multi-ethnic nature, water and land use, low productivity, and a narrow view of our economic future.
“Around the world the call for a post-covid reset has focused on the green economy, climate change, environmental degradation and social progress,” he said.
“There is no doubt NZ will follow this path.
“This means we need a major reset of our key industries.”
He said a global shift against carbon-intensive goods and services will over time heavily affect tourism and ruminant animal-based agriculture.
“The primary and food sector is again dominating our economy but it needs to evolve to be environmentally much more sensitive and conscious of future market trends,” he said.
-BusinessDesk
