Does New Zealand Need to Overhaul Its Industrial Policy?

Executive Summary

This report will follow the below structure to investigate the question, does New Zealand need

to overhaul its industrial policy? This policy is related to economic growth and whether they

stimulate the economy and achieve international competitiveness. There are several elements

that are needed to be taken into account but due to the limitations of this report, we will only

consider three major and they are:

- R&D Interventions/Incentives

- FTA

The first element looks are the existing system the government put in place from the

Foundation for Research, Science and Technology and their role to innovation rate and the

percentage of new innovations for small and large businesses. It appears the government is

implementing the right strategies; however, there are a few teething problems they need to

overcome especially around government regulations. This aims at pushing the private business

to increase their innovation rate in order to increase their competitive advantage. Prime

example is F&P Healthcare and the numbers of new patents they have over the last 5 years

have increased. Beside government regulations, there needs to be more collaboration between

businesses and educational institutes and further investment in post graduate studies such as

maters and PhDs.

The government is also trying to assist businesses in dissolving hurdles beyond their control.

These hurdles or barriers are set by other countries to stop international firms from competing

locally. Through the FTA these tariffs and custom fees are dissolving slowly, however, this will

take time in order to achieve its highest potential according to experts from the Asian Local

Bank. Nevertheless, I think the New Zealand government is doing strong work in this area.