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New Zealand's longest-running online daily news and commentary publication, now in its 21st year. The opinion pieces presented here are not purported to be fact but reasonable effort is made to ensure accuracy.

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Can technology really save NZ?

23 May 2011

It's a commonly held belief in some circles that NZ "has what it takes" to become a powerful force in the world of hi-tech.

We have a first-rate education system, a "can-do" mindset, and a rich heritage of achieving the impossible, thanks to names like Rutherford, Pickering, Pearce etc.

Countries like Finland have shown how even the smallest nation can box above its weight in the hi-tech world, if the conditions are favourable and the courage exists within its government and business sector.

But seriously -- are we kidding ourselves when we dream of the days when NZ's hi-tech sector will be the one that drags us up the economic performance rankings within the nations of the OECD?

Based on last week's budget, I suspect we are.

The present government has shown that it won't even pay lip-service to the issue of supporting NZ's endeavours to lift its game in the areas of science and technology.

Even the leader of the opposition (who takes his title far to literally) has proven how bereft of sensible policy ideas his party is.

Labour's suggestion that they'll offer a 12% tax concession for R&D misses the point completely.

The sorry truth is that, without external help and investment, NZ really doesn't stand a snowball's chance in hell of becoming anything more than a consumer in the crucial world of hi-tech and the knowledge economy.

Gone are the days when a farmer tinkering away in his shed can come up with a device like the jetboat that changes the world and generates jobs in the local economy plus massive overseas earnings.

These days, even the most incredibly good idea, no matter how practical, requires very, very large fists-full of cash to develop, manufacture and market.

Here in NZ, thanks to 19th century perspectives on the part of government, our investors are too busy planning a new commercial building or scanning the property pages for another rental to add to their property portfolio.

And even where the going is easier, such as in the online world, there has been no Kiwi-conceived equivalent of Facebook, Google, Twitter, Linked-In, Groupon, eBay or the like.

Sure, various Kiwi companies have copied those industry-leaders, but about the closest we've come to creating a "buzz" and a profit online with a truly unique and innovative product or service is Ponoko.

Even when some bright Kiwi comes up with a fantastic "million dollar idea" they find themselves faced with a total lack of interest from the local investor community.

"Too risky", "I don't understand it", "no thanks, property prices are rising", "we'll need your house as security"... that's what Kiwi entrepreneurs hear all too often when pitching for funding to develop a really good hi-tech idea.

As a result, most of our really good ideas get exported for a pittance, long before they're actually realising their full potential.

Either the "ideas guy" packs up and heads for a country more receptive to the concepts of investing in hi-tech or he muddles along long enough that his idea catches the eyes of a real venture capitalist from a far-off land. That VC then says -- come here and we'll fund you -- at which point the "ideas guy" leaves NZ, taking his business and his profits with him.

While other countries continue to raise their game, improving their productivity, switching to hi-tech industries and fully embracing the knowledge wave -- NZ seems to be drifting backwards and is now so heavily reliant on its dairy sector that something as simple as an outbreak of foot and mouth or other disease could see us all facing a massive drop in our incomes.

Meanwhile, it seems that the best our politicians can do is sit back, cross their fingers and pray that the Reserve Bank is right when it predicts (against all evidence) that we'll soon be enjoying growth rates of 4% and a return to budget surplus.

It would appear that we're speeding down the a dire straight with less than one hand on the wheel.

Heaven help us.

But hey, "she'll be right"

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