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5 Thoughts from the Executive Director

1. Agritech opportunity 


What are our local councils doing to attract agritech companies to the Waikato?

Agritech firms should be an absolute target sector for Waikato councils to be promoting the Waikato as the best place in New Zealand to do business. 

Agriculture is a part of the fabric of Waikato society. We live in one of the most advanced agricultural valleys anywhere in the world. Combine that with the tech revolution that is underway in the Waikato and you have a potent mix of world leading hybrid vigour.

In fact, you couldn’t script it better. The University of Waikato (UoW) is one of the most advanced tech universities in the world. Many of its alumni are world leaders in the Internet of Things, many have started their own companies and are making tech one of the largest of New Zealand’s exports. 

There are great reasons why some of the world’s most innovative agritech companies are here in the Waikato. Companies like TetraLaval and GEA don’t pop up here by accident. Familiarity breeds amnesia, so it is easy to forget the tremendous effect homegrown companies like Gallagher and Fonterra have in our Waikato economy. 

But are our local economic development teams being resourced to go and get more?
Are our local councils welcoming to agritech companies settling in the Waikato? Are we making them aware of the obvious benefits to being based in the Waikato?

We have the workforce, UoW and Wintec produce outstanding graduates, we have the space, but do we have our councils actively encouraging agritech businesses to relocate or even stay in the Waikato?

If they are, we need to hear about it.


2. What’s in a name?

David Hallett and Jeremy Hughes, the leaders of Company-X, have floated the renaming of the Waikato to Silitron Valley, given the large number of tech firms that are sprouting up here. 

Some have suggested it should be called Silicotron Valley or even Agritech Alley.
What do you reckon?

Drop us a line with your suggestions on a name that better promotes the Waikato as the world class place to do business in New Zealand.


3. Fonterra shifting back to the Waikato 

Why is Fonterra paying such high rentals on the head office at 6/109 Fanshawe St, The Viaduct, Auckland, when they have sufficient room to build an outstanding Fonterra campus at Te Rapa?

It seems crazy that Fonterra is so disconnected from its shareholders, its manufacturing, and its wider stakeholders by staying in its ivory tower headquarters in the most expensive office space in New Zealand.

How living in the Viaduct, with its proximity to the America’s Cup and high-class downtown restaurants, improves its executives’ understanding and empathy with the dairy industry, is a mystery.

It’s an international company so needs proximity to Auckland International Airport you might argue (although that’s moot point at the moment with our borders essentially closed), but given the beautiful Huntly bypass and the comfortable pace of the Waikato Expressway, the time difference from Te Rapa to Mangere is now a mere 30 minutes longer than battling Auckland traffic from the Viaduct.

Is this an opportunity the HCC Economic Development committee should be chasing?


 4. Tiwai Point 

The closure of the aluminium smelter at Tiwai Point is a very sad day for the 1000 plus workers there and will have a heavy ripple effect throughout Southland. 

A worldwide glut of aluminium supply may mean it is cheaper for New Zealand to import its requirements. 

With politicians ducking for cover at the sight of bad news there is very little concrete evidence of its effect on the cost of power to your business. 

Everything points to much higher transmission charges so that Transpower can build sufficient capacity to ship the Manapouri generated power up North.
 
Whether that will result in higher overall power bills or not is another question, based on your location and usage. If you are budgeting, then be conservative and factor in an increase. 

With Tiwai Point only taking 13% of New Zealand’s generation the effect of that supply dumping into the New Zealand market may not reduce power prices as our population, especially in Auckland, grows. 

Which begs the question: Are you getting a good deal from your power provider?


5. Amalgamation of local government

It may be just Three Waters at present that the Government has it on its agenda, but there appears to be a very strong movement in this Government’s propensity to centralisation.

You can see it in the changes led by Chris Hipkins in tertiary education, followed closely by the recommendations of the Helen Simpson report on the health system.

Now Nanaia Mahuta, the Minister for Local Government, has just announced the Government’s investment of $761 million into local body water infrastructure improvement. Is this the first real move in a transformation of local government?

The current New Zealand water model has 61 territorial authorities and seven unitary authorities providing services, along with major providers in Auckland and Wellington. Of late, several have been found wanting in their planning and implementation. Auckland with its current drought trouble, Wellington with its sewage flooding into the harbour and very expensive rectification costs, Hawkes Bay with its quality issues with drinking water. The list goes on. 

Successive local council politicians have kicked the Three Waters investment can down the road for decades. They do so in order to hold rates down and get elected. It is our generation that is now paying for it. As always, it is the community that pays for pork barrel politics years later.

The Government wants to revamp the system to have a small number of publicly owned multi-regional entities, based on factors such as benefits of scale, communities of interest and catchments. At least one large urban area would sit within each entity.

Will this see the start of amalgamation of councils in the Waikato? For many well-run councils there is no need, but for councils where their politicians have not invested wisely in the upkeep or expansion of intergenerational assets such as water, amalgamation by central Government may be on its way.


Have a great week!

Regards
Don

 
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