Has Britain Gone Mad?

cowThe United Kingdom seems to have become infected with another case of “mad cow” disease, if the events of the past few weeks are any indication. Prime Minister-elect Theresa May’s appointment of Boris Johnson to the post of Foreign Secretary seems designed to maximise offense to Britain’s neighbours, already reeling from the extraordinary Brexit campaign, of which Johnson was himself a prominent supporter.

May’s appointment of Johnson should be no surprise however. Three days into the job, she has already been accused of pandering and being inconsistent in her position on foreign investment, amongst other issues. The Boris appointment is either an awkward misjudgement or a clever ploy to undermine the entire Brexit process – which she quietly opposed during her time as a senior cabinet minister.

The new Prime Minister also seems in no hurry to start the exit negotiations and who can blame her. The Brexit debacle has plunged the UK into it’s biggest political and economic crisis since World War Two, say some commentators. Furthermore the exit vote was not exactly a landslide. There might yet be more water to flow under the Euro bridge as Britain stares down the barrel of an estimated 5-10 year recession as the full implications of Brexit take hold.

In a world of uncertainty, now is not the time for isolationism and petty parochialism. Britain has benefited enormously from its previously close relationship with the Continent, but the stayer camp failed to make this case sufficiently strongly. May was complicit in this, in her efforts to appease all sides and pave the way for her own career development. That in itself is a clear illustration of why the British government is failing its people at present. The vested self-interest of a minority of over-puffed political personalities has overcome common sense.

Paul Spence is a commentator, technology entrepreneur, a co-founder of iwantmyname (a New Zealand based global Internet venture) and a mentor with Startup Weekends. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest.

Will The Real Wellington Please Stand Up

wcc2Our Prime Minister laid bare his regional biases when he implied recently that our Capital city is a hopeless economic case. But Mr Key would do well to remember that the regional economies are subsidising the infrastructure build up elsewhere.

Wellington may have lost a few corporate head offices, but its economy is a lot more diverse and robust than that. Let’s look at what’s really going on in Wellington in the context of high value, export oriented, knowledge based business activity. According to economic think tank Infometrics, in 2011/12 the overall number of businesses in Wellington actually grew slightly, whereas in Auckland the number dropped considerably. More importantly, Wellington has the highest GDP per capita of any New Zealand region. This is hardly surprising when we look at the emerging economic players.

Activity in the screen and digital sector grew twice as fast as the New Zealand economy generally, with film, animation, gaming and software delivering a billion dollars to the region annually. Wellington has the highest intensity of knowledge based businesses per capita, a busy port, two universities bursting with fee-paying foreign students and an enviable and growing tourism profile globally. Wellington also boasted the highest number of New Zealand companies in the Deloitte Asia Fast 500, an international benchmarking initiative that identifies high growth ventures across Asia-Pacific.

The only business types that decreased in Wellington were insurance and financial services. That is hardly surprising when you consider that insurance companies have little interest in the Wellington market post Canterbury earthquake and finance companies have been dropping like flies everywhere anyway. No great loss. It’s also no secret that government services have been operating with sinking lid staffing policies for some time amidst austerity measures. But despite fear mongering by public service unions, the actual number of staff affected has been minimal. Government sector makes up only about 10% of the regional economy (about the same as tourism income).

Many of us have invested a huge amount of effort into building creative communities in our region that have underpinned the growth of high value, knowledge based businesses. In the context of a sluggish global economy, Wellington has held its ground relatively well, so it is certainly unfair to make comparisons with the other main centres, which have entirely different contexts at present. The government should also be reminded that the growing tax take in the regions is supporting spend-ups in other parts of the country.

Paul Spence is a commentator, technology entrepreneur and is a co-founder of iwantmyname, a New Zealand based global Internet venture. You can follow him on Twitter @GeniusNet

 

Shaken and Stirred

Politicians and dignitaries emerged in a sombre mood from the meeting house at Waitangi earlier this month, after a local kaumatua stood up and pronounced that a major city would soon be destroyed by an earthquake. This week New Zealand experienced its worst natural disaster of modern times when Christchurch, our second largest city, was badly damaged by a devastating quake. After a tough year in 2010, this event is likely to have severe repercussions for the entire nation both in economic terms and for morale in general.

It was bad enough that Christchurch took a hit in September, but this event is much worse. Officials are already talking about the possibility of a final death toll in the hundreds and over $6 billion in repairs being needed for the stricken city. Residents must be shocked at how their lives have been turned upside down. For the rest of us, the situation seems surreal and we feel powerless to assist. But this is the scenario we’ve been taught to prepare for all our lives. We just never expected it to happen in the garden city.

Seismic and volcanic upheavals are a fact of life in a country like ours; we sit astride two very active tectonic plates. The forces that built this land can also destroy it. In the short term, the remainder of the nation will need to step up to support our southern cousins. That could mean some form of additional taxation. It will almost certainly mean a dent in our fragile economic recovery. Apart from the pure financial cost, it is hard to focus on productive work when friends and family are suffering and horrifying images of destruction are being broadcast into our homes. If we are to help Christchurch rebuild, we must ensure economic growth continues throughout New Zealand.

* We’ve compiled a list of web-based resources on the iWantMyName NZ blog, for anyone who is worried about missing persons or is keen to help in some way.

100% Puree

The recent media clamour criticising Tourism New Zealand’s new campaign threw up some intriguing responses from a seemingly random selection of ¬†“marketing experts” who had been canvassed for their views, but who completely missed the real problem with the new approach.

With New Zealand already ranking as third strongest “country brand” for tourism last year, you would think that Tourism New Zealand might think twice about giving up on their successful twelve year old promotional style that focuses on New Zealand’s natural attributes such as landscapes, flora and fauna. 100% Pure New Zealand has evolved into 100% Pure You. I’m not sure if that is a reflection on our¬†increasingly tenuous environmental credentials or the fact that the next generation of global travellers are more self-absorbed. Perhaps both.

The new campaign is obviously a response to the Aussie battle cry “where the bloody hell are you?”. All of the actors in the video clips are youthful, white, middle class, which not only belies the multicultural nature of Australian society to which it is targeted, but also politely ignores the fact that the fastest growing inbound tourist sources are in fact other places like China and India. The new campaign strengthens the message that New Zealand is all about hedonism and short term gratification – a message that resonates with young backpackers.

Unfortunately backpackers have the lowest per diem spend of any segment in the market. Shouldn’t we be focussing on attracting more of the upper end of the market? Don’t get me wrong. I’ve backpacked all over the world myself and it was character building and great fun at the time. I’m not for one minute suggesting we limit access on the basis of disposable income. I’m simply suggesting we revisit where our tax dollars might best be spent for greatest return.

Tourism is a huge part of the New Zealand economy, but it has a considerable environmental footprint and creates little ongoing value. It’s all about extracting short term gains from renting as many seats as possible. Jobs in the tourism service sector are generally amongst the least well paid. Perhaps we need fewer “freedom campers” pooping on our roadsides and more doctors and their families from Bangalore enjoying our sparsely populated geographic beauty. Dare I suggest it, but maybe we could also get them thinking about investing in New Zealand, whilst we have their undivided attention.