PM aims to open Aussie eyes

By GREG ANSLEY in Canberra

In February, a clutch of New Zealand companies clustered together at a giftware show in Sydney, rimming the top of their adjoining stands with a band of purple.

No fern leaves, kiwis, koru or anything else proclaimed their nationality: transtasman origins, the group had decided, could be a distinct disadvantage in winning a slice of the Australian market.

Although some Kiwi branding campaigns in Australia have been massively successful - New Zealand wool, for example, has become synonymous with quality and prestige in carpets - the giftware group's heads-down strategy was far from unique.

Next month Prime Minister Helen Clark will lead a mission across the Tasman in a bid to change all this, aimed at opening Australian eyes to New Zealand technology and opportunities, and eroding stubborn perceptions of Kiwis as yokels.

"The starting point is that right now some Australian perceptions of New Zealand are not particularly flash," said one official.

It is an entrenched view.

The latest Australian Department of Foreign Affairs and Trade outcomes and objectives statement considers that New Zealand's heavy reliance on agriculture, tied to a lack of investment and shortage of skilled labour, has kept economic growth from matching that of other OECD nations and widened the gap in transtasman performance.

This is the prism through which policymakers in Canberra regard New Zealand, and the basis on which advice is framed for Australian companies interested in doing business across the Tasman.

There are also damaging perceptions of the quality of New Zealand management, spurred by the collapse of Ansett Airlines last year and perpetuated in the run of jokes along the lines of: "How do you set up a small company? Give a Kiwi a big one."

The large number of New Zealand companies operating successfully in Australia - including Fisher and Paykel, Lion Breweries and Tower Insurance - tend either to be ignored as exceptions or blurred into corporate Australia.

"I guess you look at the likes of Fisher and Paykel," said John Nicholson, Tradenz regional manager in Sydney. "Do they have a strong New Zealand identity? No, they don't."

Ansett was a loud wakeup call for Wellington, creating huge tensions both at the highest political levels in Wellington and Canberra and in the suburbs of Australia - where resentment at the loss of a national icon still lingers - and casting dark clouds across the competence of New Zealand's corporate leadership.

The Rugby World Cup fiasco, the latest transtasman spat, is also widely regarded in Australia as a business, rather than sporting, failure by New Zealand.

Helen Clark, who felt at first hand the fury over Ansett when her transtasman flight was blockaded by unionists at Melbourne, believes New Zealand cannot take Australia for granted nor rely solely on political interaction which, with John Howard in power in Canberra, remains for the moment on a pretty even keel.

She wants instead to take the message directly to corporate Australia, which largely remains in ignorance of the fact that, for example, New Zealand's share of transtasman manufacturing production has risen while Australia's has fallen, and that more of our exports are manufactured.

The importance attached to the May 27-31 mission is signalled by the fact that it is happening at all. There have been uncountable political trips across the Tasman, and scores of business delegations of one kind or another, but nothing on this scale has ever been planned before.

No Prime Minister has led anything like this party of up to 30 of the nation's most influential corporate leaders, headed by Telecom NZ chief executive Theresa Gattung, to Australia. Washington, Japan, China, South America, yes, but Sydney, Melbourne and Brisbane ... ?

Ansett underscored to Wellington the dangers of taking Australia for granted and the need to garner understanding and influence in a business community in which, even with the considerable number of Australian companies with major transtasman interests, the New Zealand voice remains weak.

"Australia is our biggest and most important market, yet we send trade missions flying over the top of Australia to Asia and South America and places like that, and ignore the fact that the Aussies are our key economic partner," one official said.

"The mission is a realisation that we have to look after our interests closer to home, first and foremost."

Australia takes 18 per cent of New Zealand's exports, ahead of Europe and the United States, with transtasman merchandise exports last year rising 5.7 per cent to A$4.74 billion ($5.733 billion) - slower than the 8.9 per cent rise in Australia's A$7.15 billion sales to New Zealand.

New Zealand's exports of services to Australia - about half of which came from travel - slipped by 5.3 per cent last year to A$1.62 billion.

Two-thirds of merchandise exports to Australia are derived from manufactured goods (A$976 million), food and live animals (A$889 million), Machinery and transport equipment (A$788 million), and miscellaneous manufactured articles, ranging from prefabricated buildings to travel goods (A$504 million).

Within these Australian classifications, 10 major sectors provide 50 per cent of total transtasman export income: petroleum and petroleum products, A$406 million; textile yarn, fabrics and made-up articles, A$323 million; electrical machinery, appliances and parts, A$285 million; miscellaneous manufactured articles, A$236 million; dairy products (and eggs), A$224 million; general industrial machinery and equipment, A$210 million, A$194 million; cork and wood, A$185 million; miscellaneous edible products, A$171 million; seafood, A$165 million.

While most of these involve sophisticated value-adding and technology, this does not generally register in the Australian consciousness.

And the groups that could be expected to state New Zealand's case as an advanced, new-wave economy - medical and pharmaceutical products, specialised machinery, office machines and automatic data processors, telecommunications and sound equipment, professional and scientific instruments and photographic and optical goods - provide only 4 per cent of the value of exports to Australia.

But Australian perceptions of New Zealand are not only the fault of the Aussies. Trade officials over the years have noted the reluctance of many New Zealand companies to proclaim their origins.

Nicholson said companies at the Sydney giftware exhibition found such fears might be misplaced.

He believes New Zealand has the potential to make an impact in a market which barely knows it is there.

At the world congress on international technology in Adelaide this year, several of the six New Zealand companies exhibiting were "rushed off their feet", he said. "There was just complete surprise that the sorts of technologies they had on display had come from New Zealand."

Next up is the Australian Information Industry Association-CeBIT trade fair in Darling Harbour, which the Clark mission will visit.

Twenty-six New Zealand companies will exhibit at a software showcase restricted to innovators turning over less than A$5 million a year.