The Ngawha Innovation and Enterprise Park, which officially opened in June 2023. Photo / Supplied
The Ngawha Innovation and Enterprise Park, which officially opened in June 2023. Photo / Supplied
Opinion
One basic tenet of economics is if you enhance the quality of raw materials, say, by making them easier to use, tastier or more beautiful, then you are adding value and people will give you more money for the thing you have made.
As value-added products are sold this increases the pool of money available to invest and grow the business, hire more people, and pay better wages.
The increased money in the system in turn gets put back into the economy as these employees and businesses buy other goods and services, and, in general, wealth increases.
If you’re selling those products outside your region, in theory, that means more money comes back into your regional economy and equates to a bigger plum and custard (wealth) pie. Huzzah.
Now, we all know that theories are great and real life is a lot more complex than this, but hear me out.
Northland creates less from its raw materials than other regions … a lot less. Northland creates 1.5 processing jobs for every 1000 tonnes of raw materials, compared to seven jobs in Hawke’s Bay and 30.5 jobs in Auckland (Coriolis, 2019).
Yep, very little processing or value-adding activity is done in Northland - a crude measurement you might say, but we don’t have a heap of robots doing it for us, either.
To really get into the feeling space of what this means for Taitokerau, let’s run an example. Okay, so, say a big box of Kerikeri oranges gets sent out of our region to be processed into juice. This is bottled, shipped, and sold by a manufacturing company down the country.
In this scenario, the benefit of the “value-adding” circulates where the processing occurs not where the oranges were grown, and the Kerikeri orchard gets “orchard gate” prices. Fair, right, given that is as much work as was done?
But it’s not just about growers’ returns, remember that plum and custard (wealth) pie? In general, the higher production areas have higher income per capita.
There are more jobs there that pay higher wages, so this attracts more people. Higher populations typically lead to more and better infrastructure spend, supporting businesses and communities.
Investment flows into these places because there’s a higher return, and higher R&D and value-add processes are pursued, including training of employees for higher productivity. Things grow and prosper, and in turn, more wealth is created. Meanwhile …
Caroline Wells is an Investment Facilitator at Northland Inc, the region’s economic development agency. Photo / Supplied
Northland 1.5: Hawke’s Bay 7: Auckland 30.5. Guess who’s winning? Not us. Grrrr ... right?! Don’t let me get into offshore comparisons. Grrrrrrr.
If this lights a fire under you, good. Me, too. We should all care about the well-being of our fellow (wo)man (and our environment) and fight for more for ourselves and for each other.
As Northlanders, we are acutely aware of the challenges we face up here, we experience them daily in every pothole.
Challenges? Let me give you the list: It’s beautiful up here and we’re proud to be Northlanders but we’re proud and on the whole, poor and that, well, grrrrrrrrrrrrrr.
Breathe in one-two, out one-two. Smile. But you know, we can moan about it or roll up our sleeves and get on with the job, eh?
So, how do we shift the dial on the cooker and eat more pie (not just plums)? Well, experience tells us that complex issues don’t get solved overnight unfortunately (otherwise we would’ve done that all-nighter already) but the big stuff really helps, AKA big investment into the region, such as the Puhoi motorway, or the proposed port development in Whangārei. rojects like the Hawaiki Cable, Hundertwasser Art Centre, Manea Footprints of Kupe.
Having one insistent, united, Taitokerau-wide voice advocating for big enabling investment up here is absolutely essential.
The wealth-unlocking key here is the word enabling. If we had ‘that’ then we could do ‘this’. For example, if we had a food manufacturing plant up here, say at Ngawha Innovation & Enterprise Park, we could make our own juice.
We’re not asking for everything - with a massive 3.9 per cent of Aotearoa’s total population, Northlanders are realists - but we must insist on enough to thrive, not survive.
We’ve been in gear one for a while now. Help us help you, and all that. Make it less blimmin’ hard. I mean, people want to live here but if they can’t make it work, see ya later. It’s a sad cycle.
Now, I work in the Investment and Infrastructure team for Northland Inc, Northland’s Regional Economic Development Agency, and I have the privilege of working with people who dream big about ‘big investment’ for Taitokerau, not just in the office but out there on the ground. Northland Inc strives to be that insistent voice, advocating for Taitokerau up into central government, and being a conduit to our businesses on the ground.
Bearing in mind that 99.7 per cent of our business community are SMEs, our business leaders (at least) are largely mums and dads. That’s why unity is important.
We’re not heavy on heavyweights. But leaders we have, and they’re in our communities linking the dots, going “You know, if we just had ‘this’ then we could do ‘that’” and crucially, “Who could help us with this?”
Developing a Shared Food Manufacturing facility at Ngawha is an example of hearing that call, but it’s taken a team to make the dream happen.
And yes, it’s only at the prototype stage but it’s happening. One day we will drink juice that WE made.
Big infrastructure/investment enablement is of course only one way we’ll shift the dial and create a bigger plum and custard (wealth) pie.
I don’t say this lightly, it’s multifaceted. We’ll save education, innovation, R&D and so on for another day.
Suffice it to say, what’s the takeaway? I say, every upgraded jetty, every new bike track makes a difference up here.
Let’s get behind each other’s ‘big’ or small ideas about how we can unlock more value and enable greater wealth for Taitokerau. Keep asking, “Who could help us with this?” It could be us.
Caroline Wells is an Investment Facilitator at Northland Inc, the region’s economic development agency
