Comment: Get moving on the Asian (New Zealand) century

Ali Spencer2It’s the Asian century and New Zealand hasn’t got much time left to capitalise on our head start. We need to get moving, writes Ali Spencer.

That’s the message the came through in yesterday’s Riddet Institute Agri-Food Summit Continuing the Dialogue – the Asian Century, or as convenor Riddet’s general manager Mark Ward put it:  “It’s not only the Asian Century, it’s the New Zealand century.”

Riddet’s aim, as biotechnologist and chemical engineer Dr Kevin Marshall noted, was to bring together influencers at the Summit with the objective of continuing the dialogue started two years prior with the Call to Arms summit, followed by the two Stanford University Boot Camps one for senior sector leaders, MPI and NZTE and the other for Māori leaders. Apparently, the two groups have since joined together.

Marshall was hopeful that the Summit will be a catalyst for action by the New Zealand agri-food industry to seize the opportunity, which in his view, “has never been greater.”

Primary Industries Minister Nathan Guy delivering the good news at the Riddet Institute Agri-Food Summit in Wellington, 2014.The good news from Minister of Primary Industries, Nathan Guy, that primary sector export returns are forecast to grow this year by an extra $4.9 billion, than initially forecast, to $36.4 billion – and within that meat export returns are expected to rise by six percent more than first thought – was welcomed by the audience of about 110 agri-food industry leaders, academics, scientists and government officials

Aside from high commodity prices, particularly for milk powder, the opening up of China to New Zealand exports was cited as the main reason for the rise.

It’s a start towards the Export Double target Government has set the sector for 11 years time (2025), within its Business Growth Agenda, though it was noted that returns may drop back a little next year as the dairy commodity prices drop back.

Further enhancement of market access, including negotiation of Free Trade Agreements and conclusion of the ‘Holy Grail’ Trans-Pacific Partnership, together with the Government’s support for the sector through the Primary Growth Partnership programme and activities by the Ministry of Business, Innovation and Employment and New Zealand Trade & Enterprise, including the New Zealand Story support for exporters, will see more growth towards the 2025 target.

However, as presentations from Professor David Boxer, director of the UK’s Institute of Food Research and Professor Srivastava, director and vice-chancellor of India’s National Dairy Institute showed, the EU, UK, Ireland, India and other countries all have strategies to lift their agrifood sectors by 2020, including re-shaping of food/innovation clusters, so competition will be fiercely fought.

Asian markets: golden opportunity

The ’emerging’ markets of India and China were covered in the excellent presentations.

Professor Srivastava, India National Dairy Institute

Professor Strivastava used his “glorious data” to show how India, one of the BRIC emerging economies, has progressed since being in the position of food importer in 1947 to virtual self-sufficiency in the 1980s. Now with a 1.2 billion population, India is now the world’s largest producer of meat and is a major exporter of beef. However, because the animals are not reared specifically for meat purposes, it also faces the challenge of increasing meat quality, though that issue will be addressed by application of knowledge and technology in the future, his presentation showed. The country has growing middle classes and retail sophistication, however, Srivastava also pointed to the global challenge of hunger, which affects India most out of the BRIC nationals and needs to be tackled, along with macro-nutrient deficiencies in its population.

However, Asian markets are a “golden opportunity for the food processing sector,” he noted.

How to work in China was covered in various of the other presentations.

Michael Jamieson, MPI (3)Michael Jamieson, MPI’s new director of strategy, systems and science policy, formerly with Lion Nathan, Nike and Icebreaker brands, pointed to the world’s increasing connectivity. MPI work strands include go global, go Asia, go green and get personal, he said, alluding to social media. Protecting New Zealand’s comparative advantage and natural resources is as important for MPI as maximising production.

According to Jamieson, China’s growing demand for imports is creating changes and opportunities in all export markets. He noted that changes are already occurring in the country’s food distribution networks making it easier for imported foods and beverages. International brands are already in there and building the infrastructure. Exporters need to move beyond simply delivering to the distributor at the Chinese wharves and get involved through the whole supply chain.

He is also excited about the use of new technology in the Asian markets. For example, selling online in China has increased exponentially, he noted, urging. “If you want to get into this world, get kicking.”

The wind is blowing in New Zealand’s favour, he believes. “This is the best chance we’ve had in a long time to get this waka moving,”

China: protocol important

Chris Kelly, Vice-Chancellor, Massey University.Massey University chancellor Chris Kelly, ex Landcorp chief executive, said he doesn’t think China is a ‘bubble’. However, the Chinese people are different from the European and US business people Kiwis have been used to dealing with “and you have to respect that.”

From his experience, he has learned that contracts are the start of, not the end of, negotiations and recommended signing Memorandum of Understandings early in the business process to focus the negotiations. There is a balance of being patient and genuine, yet firm, he said, adding that trust is extremely important. Other protocol tips he gave the audience were: do your homework before meetings; respect hierarchy, the senior member should never be interrupted; present business cards with both hands and read theirs carefully; don’t wrap gifts in black, blue or silver; don’t ask them to turn their cellphones off in meetings; and always leave a little wine in your glass after a toast.

Feed the world (and talk about it)

Feeding the world’s population, forecast to rise to nine billion by 2025, requires the acceptance of innovative science by consumers, it was agreed during the closing panel discussion. “It’s a massive problem that needs to be handled sensitively,” said Boxer. A start would be getting away from the image of a traditional industry with an information flow to educate the public, he believes. Consumers empower themselves by using social media to find information, the panel noted, so farmers, for example, could talk more on social media not only about their day-to-day work, caring for animals, but the technologies used and how science is applied practically.

Find scientists

Another challenge for the agri-food sector is finding enough scientists to undertake all the work required.  More work needs to be done, particularly in schools, on encouraging youngsters to consider a science career, the panel agreed.

Step up for leadership

As Chris Kelly noted that: “It’s been nearly two years since the Call to Arms, it’s up to us to do more regarding leadership for the sector and commitment.”

In the new global business environment, the panel suggested, maybe it is time for organisations to reassess their roles in the sector and take leadership.

You can read more about the Summit here.

For more information about the Riddet Institute, click here, or visit the new Riddet Foodlink website for more about the Institute’s Food Innovation activities.

 

 

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