NZX is a proud sponsor of the PricewaterhouseCoopers NZ Hi-Tech Awards again this year, and would like to congratulate all individuals and companies, particularly NZX Listed companies Fisher & Paykel Healthcare and Xero, who received awards at the Gala Dinner on Friday night in Christchurch.

Fisher & Paykel Healthcare (NZX:FPH) was the 2009 PwC Supreme Award Winner and Xero (NZX:XRO) took out the HiFx Innovative Services Product Award.

Sir Gil Simpson, Dennis Chapman and Ian Taylor joined the PwC NZ Hi-Tech Hall of Fame after winning NZX Flying Kiwi awards last year, and were acknowledged again for their contribution at the Awards on Friday. NZ Hi-Tech Association chair Wayne Norrie described the NZX Flying Kiwi award as “the highest honour our hi-tech industry bestows upon an individual.”

NZX also had the honour of presenting the NZ Hi-Tech Association Special Award, in recognition of service to the New Zealand hi-tech industry, to Marion Rogers. Marion was instrumental in establishing the Hi-Tech Awards and has been involved in many other industry initiatives including founding the Electronics Manufacturing Council and the Electronics Exporters Association of New Zealand.

The closely watched Endace Young Achiever Award was awarded jointly to Andrew Graham of Inro Technologies and John-Daniel Trask of Mindscape.

Congratulations to all PwC Hi-Tech Award 2009 winners and to those involved in organising this very successful event, especially the great team at Swaytech.

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See this weeks lead story in New Zealand Farmers Weekly by Tony Leggett on NZX’s acquisition of Country-Wide Publications Limited.

This year, prior to the NZX Annual Meeting, the Hon Simon Power will be delivering a presentation on the
Regulatory Vision for the NZ Capital Markets - Key Principles and Priorities, which will commence at 8.00am. The sixth Annual Meeting of shareholders of NZX Limited will run from 8.30am, which you are also welcome to attend.

Please RSVP to Lucy McFadden, NZX Communications at lucy.mcfadden @ nzx.com or by phone on (04) 496-2890.

I am Susan Kilsby and my role here at NZX is Head Dairy Industry Analyst for NZX Agrifax and Dairy Week.  The reason for this Blog post is to make available our latest article which looks at the downward plight of dairy commodity prices and the drivers behind the decline. As with all previous posts of this Blog, this is a topic related to the health and growth of the New Zealand economy.  This article will be of interest to all those that monitor the New Zealand dairy sector and anyone else who wants to broaden their understanding of what is going on in this sector right now.

There has been a lot of industry and media comment recently on the price decline of whole-milk powder and the role that globalDairyTrade auctions have played in it.  The objective of this article was to investigate the validity of this claim by first reviewing the reasons behind the dramatic price increases, which peaked in October 2007, and then by reviewing what has subsequently happened in the market to drive those prices tumbling back down again.

For background, as well as NZX Agrifax (which monitors and analyses the New Zealand primary sector and commodity prices) and Dairy Week (a weekly abstract news bulletin service) NZX also owns the Australasian agricultural business  ProFarmer (an Australian grain market monitoring service).  Dairy Week and ProFarmer were both acquired last year.

Download the full press release “Consumer demand behind price fall, not globalDairyTrade”

Download the Full Article Here: “globalDairyTrade - Instigator of price falls or an insight into global market conditions?”

Please feel free to post any questions or comments, either on this article or the dairy sector as a whole, here on the Blog.

Welcome back, and I hope everyone is looking forward to another year of opportunities to contribute. Some quick thoughts from me, in a pretty busy period:

• Where the world is at right now is still pretty interesting. Failure of Nortel gives a strong sense that corporates, as well as individuals, are hoarding cash rather than spending/undertaking business investment. Jobs cuts and losses globally are mounting quickly, and revisions to the downside are tennis match to “love” in the tennis match with the “upside revisions” thus far. This will change…
• New Zealand remains well positioned compared to other countries, and does have a real chance, still, to come out of this global tumult very well on a relative, and potentially absolute basis.
• The Prime Minister’s Summit on Employment is a strong signal from the PM that there will be public/private sector cohesion, which is a positive change of tone.
• It is very important that, like with the response to Swanbelly and Lloyd’s “Measurable Goal” that everyone thinks hard about new ideas, and what they or their organizations can tangibly do…

In terms of the NZX Blog,  the focus which grew up around the Swanbelly releases and your feedback - the economic future and growth focus of the NZ economy -  will remain consistent, the topics will move on, and obviously the upcoming Summit on Employment will be a reasonably big one.

“The end of the golden weather: The financial crisis, global recession and what this means for New Zealand,” has been released today by Benedikte Jensen of the NZ Institute.

This is the first in a series of in-depth papers from the NZ Institute that will look at the current global economic environment, what risks & opportunities it presents to New Zealand and measures and actions required to ensure that New Zealand emerges strongly. A key conclusion is that this is more than just a business cycle, and the crisis may have a long term effect on global economic growth.

Some background and context:

• The global financial crisis began over a year ago with the emergence of the US sub-prime mortgage crisis and has continued to intensify with the collapse of major financial institutions, ongoing sharemarket volatility and drying up of access to credit worldwide. 

• The International Monetary Fund (IMF) has shaved two percentage points off its forecasts for the global economy in 2009 since July 2008. The IMF is also now predicting output in all advanced economies to contract on a full year basis in 2009 - the first time this has happened in the post-war period.

• The OECD has concluded that this will be the most severe global recession since 1981. An ‘L’ shaped recovery is predicted (i.e. A slow recovery where the US and Eurozone experience four quarters of negative growth, followed by several quarters of anaemic growth in late 2009 and early 2010. Stronger growth does not return till September 2010).

• Economic growth is slowing in Asia and other developing countries.

• Government interventions have begun to restore confidence but key markets are still significantly dysfunctional. 

This paper identifies four factors that could lead to a downward structural shift in global growth over the next decade which are household indebtedness, credit contraction and risk aversion, higher tax burdens due to worsening fiscal positions of advanced economies and a lack of a global growth engine for the economy due to the US looking like Japan in the 1990s.

It also looks in depth at implications of a global recession for New Zealand, which would likely impact through the following three main channels:

1) A reversal of the commodity boom and subsequent impacts on rural incomes and the rest of the economy

2) Credit contraction hitting investment by New Zealand companies and New Zealand’s ability to attract foreign investment

3) Difficulties for New Zealand in continuing to finance our large overseas debt as foreign investors become more risk averse

In the coming months the NZ Institute will also release focus papers on Growth Channel and Credit Channel Exposures, The Fiscal Position and Stimulus, Savings & Capital Markets, Government Balance Sheet and New Zealand’s place in the world. All papers will provide recommendations for concrete actions and solutions to ensure that the New Zealand economy emerges strongly. 

NZ Institute highlights, on both introduction and conclusion of this paper, that it is the end of the golden weather and we urgently need to prepare New Zealand for what may be an unprecedented global environment over the next decade.

Download ”The end of the golden weather: The financial crisis, global recession and what this means for New Zealand” (PDF)

On December 8, Parliament will resume sitting. Within 2 weeks of this an announcement is expected including full details of the economic stimulus package from the new Government.

Infrastructure spend and tax cuts? What else? 

What would you like to see? Post your views here on the NZX Blog.

On this site, we are in agreement that we urgently need a clear, coherent economic strategy that resonates with the country, and leads to great outcomes.  To achieve great results will require:
 
(i) a single, clear “organising idea”
(ii) a new form of national dialogue
(iii) improved public-private sector trust-based relationships

However, almost as important as ‘what’ the strategy is, is ‘how’ the strategy is created and then executed.  In my view, policy making in New Zealand has recently come to be characterised by its secrecy, its closed nature, and its insularity.  The public sector sees the private sector as ‘vested interests’ and thus, despite their training, naturally discount ideas as being driven by purely pecuniary interests. The private sector see public sector as out of touch, irrelevant and politicised.  Neither of these views are true.  Both need addressing, and the past approach will not do that.

There have been a lot of comments on this on the blog.  Some comments on this so far on the NZX Blog:

Jane said, “The government should be “of the people”, not a fortress.”

Baruch said, “… build a wider constituency of support”; and

Peter said, “[put] these concepts in a simpler format”.

When the private sector is engaged, it typically manifests as large committees, ‘talkfests’, and other inauthentic engagement, with most of our contributions inevitably disappearing down a black hole.  We need to avoid jamboree type talkfests with large numbers of people (a la Knowledge Wave, Ruddfest).  Equally small, ‘closed’ groups hatching plans in closed rooms, will not get it done. 

We think that there is a very large and diverse group who should be part of this debate, and this group is all Kiwi’s - whether living here or expat.  The question right now is, how to best engage all their talent and ideas? 

I have some thoughts as to how this could occur, but would prefer to hear from everyone else first, especially the online community, as to the “how”.

Hi All,

Thanks for your interest in the “Measurable Goal” initiative.  The campaign has built a real head of steam since we launched it a couple of weeks ago, so we thought we’d send out an update on progress and next steps (for further detail, please check out the attached PowerPoint document).

The NZX blog (www.blog.nzx.com) has had great support and the message has spread to New Zealanders around the globe - visitors to the blog have come from 39 different countries!  The campaign has also received significant press, radio and television attention: TVNZ, TV3, the New Zealand Herald, the Dominion Post, the Sunday Star-Times, the NBR, National Radio, Radio Live and Newstalk ZB have all covered the Measurable Goal idea.

Importantly, the concept is starting to gain traction with political leaders. The National-ACT Confidence & Supply agreement includes a commitment to closing the income gap between New Zealand and Australia by 2025, and it states that the new Government will establish an advisory group to recommend policy changes and report annually on progress towards the goal.  We applaud this move towards adopting a long term Measurable Goal and hope to see a similar commitment regarding the progress the Government will deliver in this three year parliamentary term.

Our assessment is that catching up to Australia will probably get us to about 20th position in the global GDP per capita rankings by 2025.  We’d be interested in your thoughts on the government’s proposed goal.  Is it sufficiently ambitious? Is catching up with Australia the right objective?

As the new Government forms and starts to define its policy priorities, it’s time for us to take our initiative to the next stage.  Based on the input we’ve received on the blog and in hundreds of supportive emails, we see three main fronts on which we need to advance:

1. Engaging the broader New Zealand community.

While we’re delighted with the response we’ve had to date, we also recognize that we’ve barely scratched the surface in terms of generating a genuinely national discussion.  We’ve received very useful feedback on how to go about communicating our message more broadly and some of the best in the business have offered their assistance. We’ve also had universities come on board, offering to organise student debates and essay competitions to get the next generation of leaders thinking about where we should be taking New Zealand.  So keep an eye out for a much more public and punchy campaign that will provoke as many New Zealanders as possible to think about a long term, measurable goal for our country.

2. Getting political leaders on board.

The objective of this campaign is for New Zealanders to adopt a simple, probably single, measurable objective for New Zealand - bi-partisan, long term, ubiquitous.  Such an objective will be catalytic in driving holistic policy focus and performance to enable its achievement.  Ultimately, it will hold politicians and leaders accountable for their performance. The adoption of such a goal could take many, many years. However, over the next few weeks we aim to have discussions with senior MPs from all political parties about the Measurable Goal campaign.  We’ll be sharing our analysis of New Zealand’s current trajectory with them and summarising the feedback we’ve received from all of you.  We’ll also be asking politicians from all sides to engage in the public discussion of a goal for New Zealand, since we believe that multi-party commitment will be required to ensure that the goal is not lost in future electoral cycles.

3. Continuing to contribute to the definition of New Zealand’s Measurable Goal.

As we continue to promote public discussion and engage with the politicians, we’ll keep developing our thinking about the definition of New Zealand’s Measurable Goal. Ultimately this won’t be something for us to choose, it will need to be chosen and owned by the broader community.  But we plan to keep contributing to the discussion and providing a forum for experts and everyday Kiwis alike to share their views. We’ve received messages of support and insightful comments from New Zealand leaders in many different fields – business, economics, the environment, academia, the not-for-profit sector, sport and the arts.  We’ll be reaching out to these people and asking them to contribute publicly to the process of defining a Measurable Goal for New Zealand.

The Measurable Goal project is fast out-growing its spot on the NZX blog, so we’re starting work on a dedicated website. We’ll let you know as soon as it is up-and-running.  In the meantime, please continue to share your thoughts at www.blog.nzx.com and pass the message on to friends, family and colleagues.  For those of you in the Facebook generation, we’ve also formed a Facebook group called “A Measurable Goal for New Zealand” (http://www.facebook.com/group.php?gid=34915687764). Please join the group to show your support and invite all your friends, family and colleagues.

Download Measurable Goal - Summary of Responses and Next Steps Here (PDF)

Thanks and best regards,

Lloyd Morrison, Paul Newfield and the Morrison & Co team

Today we have released round two of Swan Dive or Belly Flop?  This version is very different, and, we believe much improved on, the previous version.