By Yoke Har Lee
New Zealand's advanced technology sector can, in just over 30 years, be a potent economic contributor, reversing the country's economic decline.
By year 2025, the advanced technology sector could make up as much as 25 per cent of the nation's gross domestic product, Government agency Industrial Research Ltd (IRl) said.
Without the contribution of this sector, the economy, which is lagging other OECD countries in terms of living standards, will continue to be relegated to being a producer of low-value agriculture products, IRL said in a publication called The Advanced Technology Solution.
But to develop this sector, the Government needed to redirect its research funding currently heavily skewed towards agriculture.
Many of the business opportunities of the advanced technology sector were based on markets and technologies which did not yet exist, IRL said.
The advanced technology sector - defined as being the high-value, specialist component of the broad manufacturing sector - contributes about 7 per cent of the country's GDP and grows by 10-15 per cent a year.
The four main areas which have potential are:
* Information, communications and electronics technologies;
* Intelligent technologies, systems and devices;
* Materials science and technology; and
* Biotechnology.
According to IRL's chief executive Geoff Page, advanced technology offers New Zealand hope of diversifying from its role as a commodity exporter.
"In 1950, the equivalent of 0.7 tonne of wool would buy a small family car. Today, we have to produce 4.5 tonnes of wool to buy that same car. As a country, we have gone from having the third highest standard of living in the world in the 1950s to rating 25th last year," he said.
Advanced technology, Mr Page said, could also add value to traditional agriculture products. An example was the export of complex lipids extracted from milk which was traditionally a low-value product. Complex lipids were worth thousands of dollars a kilogram and were in high demand by health product and cosmetics manufacturers.
IRL's report pointed out that New Zealand continues to invest a large part of its research and development in declining sectors. "Government investment is currently disproportionately skewed towards the agriculture sector and New Zealand remains a low spender on research for the high-tech and medium-tech sectors."
"The Government needs to invest directly in the science base of advanced technology development in the four key areas already identified, including supporting alliances and spin-off companies."
Switch of funding focus urged
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