‘In an era of rapid and sustained change, being able to think and act strategically is critical.’
I was chatting recently with a friend and former colleague – Chris Parsons MNZM, DSD. Chris has just published a ‘thought leadership’ piece on alternative futures and the vulnerabilities of the NZ export economy. While focused on primary sector markets, the article makes excellent strategic points of wider relevance to us all.
Does NZ Have Too Many Export Eggs In One Basket?
When it comes to international trade, NZ has a relatively undiversified economy. As a seller, we count ‘food and fibre’ as 82% of this country’s merchandising exports. Looking at the buyers, we see that four of our top 10 export destinations (60% of top 10 revenue) are countries adjacent to the South China Sea. Ninety-nine percent of New Zealand’s trade, by weight, goes by sea and most of that via the Pacific Ocean. In the context of recent geopolitical instability in the Pacific, we wonder whether NZ is overly exposed to buyers in the South China Sea region, and whether the diversification of markets is now pressing. Do we have too many eggs in one basket?
Any questions about over reliance on our most vulnerable maritime trade routes is amplified by other factors. China’s population is likely to be half what it is now by somewhere between 2050 and the end of the century, and the populations of Africa and India are likely to lead the world in future demand. Where should our future markets be? As strategists and traders, we are encouraged to explore extension of our ‘Asia-Pacific’ area of operations into an ‘Indo-Pacific’ arena.
Building these relationships is a very long game. Astute businesses will increasingly have Pacific security on their ‘watchlists’; an interest in the state of international norms (such as multilateralism and the ’rule of law’) on which we rely for safe and open market access; and on the value in building more cultural and person-to-person connections with the likes of Indonesia, India, and gateway countries of the Middle East and the east coast of Africa.
So what, for your business?
ThinkBird is a partner for, and champion in, the adaptation of Board and Executive approaches, methods and tools for leveraging risk to capitalize on the opportunities arising from unprecedented global change. If you know a NZ leadership team that would benefit from better foresight and response to strategic threats, then we’d love to hear from you- contactus@thinkbird.co.nz
ThinkBird acknowledges the NZ Institute of Primary Industry Management’s – ‘The Journal’ as their pre-eminent publication for the rural profession within New Zealand’s primary industries.
You can read ‘Global Thinking’ by Chris Parsons here.
