The suggestion by this consultancy International Funds Services Development Group that NZ could emerge as a future financial hub is ludicrous. There is no justification for duplication services in NZ which are offered in Australia - a market with 5-6x the size, a better climate, better pay, and a broader commodity focus. It is nonsensical. Just as importantly, there is little little investment capital or investment in NZ. It is a very small market at the 'arse-end' of the world.
Anyone investing in NZ will be doing so for only one of five reasons:
1. Domestic ties - the type of business that will always need to be local, i.e. cafes, restaurants
2. Raw material production & processing - natural resources with or without processing if competitive. i.e. Some materials are too low value or bulky without processing, i.e. iron ore, or high value commodities where transport is a low cost penalty.
3. Low cost competitiveness - The best example is consulting services or call centres. NZ has a technology and price advantage, i.e. NZ is the lowest cost OECD country in the world, so you'd have to wonder why they are not building call centres for higher value servicing than can be performed by Filipinos. It could service foreign markets when they would have to pay overtime or late night salary rates.
4. Lifestyle industries like tourism, etc.
5. High value manufacturing and servicing like niche hospital equipment designs, taxi despatching systems, GPS software. For example, consider the following example of seismic monitoring systems.
These industries are hard to create unless you know something about the world. I would encourage NZ'ers to get out in the real world, the active, industrialised countries and learn what these countries are doing. It is not enough to read newspapers and online, you need to live in these places.
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