High-tech economy dream wavers as exports fall 15pc

New Zealand's bid to become a high-tech economy appears to be falling short of Government and industry ambitions, with IT exports falling by nearly 15 per cent last year.

However, the Statistics New Zealand annual technology survey said yesterday the fall was more than offset by increased domestic sales over the period surveyed.

Total exports of information technology goods and services, excluding communication services, decreased 14.9 per cent to $576.3 million during the 2004 financial year.

Domestic sales of IT goods and services increased 2.2 per cent to $6.44 billion. Total sales were valued at $7.02 billion for the year, a 0.6 per cent increase on the 2003 period.

The chairman of industry organisation ICT-NZ, Malcolm Fraser, said the fall in export sales - especially the 42.7 per cent drop in communication hardware cabling sales - was due to a combination of stiff offshore markets and the rising dollar. The dollar appreciated 9.7 per cent during 2004 and 25.05 per cent in 2003.

Nevertheless, Fraser said the fall in export sales "certainly speaks to what ICT-NZ is trying to do in terms of working with other key organisations in getting a more effective approach to exporting".

The newly-established ICT-NZ aims to act as single national organisation for the information and communications technology industry.

SNZ reported the 2004 increase in domestic sales was mainly the result of a $126.5 million or 17.4 per cent increase in software sales, and an $18.2 million or 3 per cent rise in sales of communications hardware and cables. Total communication services sales decreased $1.7 million to $5.26 billion.

Fraser said it was pleasing to see the domestic market was still growing despite some signs of a slowing domestic economy.

- NZPA