Even Guy himself concedes this is going to be “a challenge”. As he admits, it is good to have something to aim for.
Guy has several times reiterated his aim to double New Zealand primary exports since he took over as minister in February. It is also now a stated target of MPI.
But just how realistic is such a lofty goal and how will it be achieved?
According to Guy, the Primary Growth Partnerships (PGP) will be a big part of it. He says over the next seven years, some $650 million will be invested into PGPs – with government meeting 50% and industry putting up the rest.
“What we know is if all these returns are realised from the PGP, it is worth about $7 billion,” he claims. “Each $1 investment – half from industry and half from government – will return about $11 over about seven years.”
Impressive returns if these can be realised!
And speaking of unrealised potential, another of Guy’s aims is to unlock Maori agribusiness capacity – possibly worth about $8 billion annually to our economy, according to a recent MPI report.
As an example, Guy cites a small project where soil analysis was done on 240ha of Maori land, which showed some major opportunities for Manuka honey that is very lucrative in China. He says Maori agribusiness has an opportunity to use the New Zealand story for marketing, and work is being done on this by New Zealand Trade and Enterprise, Foreign Affairs and MPI.
We have already seen what a huge powerhouse Maori agribusiness could be in the sector via things such as the Ahuwhenua Trophy competition and businesses like Miraka.
Guy points out that lifting on-farm productivity also has major potential to pay big dividends.
“We know if we can lift the average New Zealand farmers into the top quarter then that’s worth about $3 billion in exports a year. A 1% productivity gain by New Zealand farmers is worth about $4 billion in exports a year.”
He says this links to the recent Government announcement of a Lincoln-based agresearch hub and getting much greater synergies from having the 900 best scientists in one place working together.
Guy has set the bar high for his primary export growth goals, but even if the sector only hits 50% of his target it is well worth aiming for.
