Businesses going global

CHINA

The growth of profits generated by China’s industrial companies has slowed for the fifth straight month, suggesting that the post-pandemic recovery in the world’s second-biggest economy is losing momentum.

Factory activity slipped into contraction in August for the first time in nearly one and a half years as coronavirus containment measures, supply bottlenecks and high raw material prices weighed on output. This slowdown of the manufacturing sector is in part due to China’s strict efforts to control its worst COVID outbreak since last year, after a number of Delta cases were discovered in the eastern city of Nanjing late last month,

These strict measures continue to affect Kiwi food and beverage exporters that have again been warned that a single positive COVID case in their workforce could lead to Chinese authorities immediately suspending their export rights and forcing a recall of products. 

In a recent guidance note to export businesses, the Ministry for Primary Industries said it was aware of new import measures being applied by China, covering all cold chain food products that are normally stored and transported under refrigeration, including vegetables and fruit.

“Cold chain food establishments, packhouses, and cold stores registered with China Customs to produce/store food products for export to China should operate on the assumption that if a staff member returns a positive Covid-19 test result it is possible this will result in China suspending the premise’s registration.”

Chinese customs officials expected any business with a staff member returning a positive test to “immediately recall any affected exports to China”, and suspend all further shipments of goods.

In other efforts to bolster the economy China has also announced the opening of a third stock exchange. The announcement comes amid heightened concerns over a potential “decoupling” of the Chinese and U.S. financial markets, with governments on both sides of the Pacific implementing policies that will make it harder for Chinese companies to go public on American markets.

The main goal of creating the Beijing Stock Exchange (BSE) is to alleviate a longstanding issue in the Chinese economy: the difficulty faced by many small and medium-sized enterprises in accessing financing.With the Beijing Stock Exchange set to focus on servicing fast-growing SMEs, experts say the move is part of China’s effort to encourage startups to list domestically.

Ciara Liu, Kea China Regional Director

UK & EUROPE

The improving health situation and ensuing continued easing of virus containment measures are putting the EU economies back in motion with the near-term outlook for the European economy brighter than expected.

In the UK kids across the nation have finally headed back into classrooms, prompting a collective sigh of relief from parents and carers alike. With the return to school also comes the return to work for many parents. The first Monday of September was the busiest rush hour on the London Tube since the first national lockdown, with 831,000 taps in to the tube network between 0700 – 1000. 

Across the UK businesses are starting to reopen, and consumer confidence is up as people look to spend money saved during lockdown on beauty, clothes and hospitality in the midsummer months. 

This desire to get out and eat is good news for Kiwi food and beverage exporters that will start to see demand rise, however supply chain issues continue to cause problems, particularly with a lack of refrigerated shipping containers arriving at New Zealand ports. There is already some nervousness around pre Christmas shortages.    

The European Commission says positive survey results among consumers and businesses, as well as data tracking mobility, suggest that a rebound in consumption is set to strengthen in the coming months. There is also evidence of a beginning revival in tourism activity, which should also benefit from the new EU Digital COVID Certificate. 

Overall the commission says, GDP is now forecast to grow by 4.5% in 2022 in both the EU and the euro area. The volume of output is projected to return to its pre-crisis level (2019-Q4) in the last quarter of 2021, which is one quarter earlier than expected. 

This growth will provide opportunities for Kiwi exporters awaiting the details of the Government’s free trade agreement with the UK. With New Zealand’s Chief Negotiator in London for the last few weeks in August, solid progress is being made and an update on the agreement is expected soon. 

Sara Fogarty, Kea UK/Europe Regional Director

North America

Hi, My name is Gary Fortune and I’m Kea’s new North America Regional Director.

My love for music and the music business has taken me on many amazing journeys all around the world where I have built a deep network of contacts. I served as an Export Manager for the New Zealand Music Commission’s Outward Sound program from 2005 to 2016, where I travelled extensively building global networks, assisting musicians and music businesses in developing their creative and business platforms to expand internationally. 

I moved to New York in 2016 with the startup music festival and business summit Mondo.NYC. where I directed the international development of the event. 

As the Regional Director for Kea in North America, I am most excited about working with the variety of innovative New Zealand companies. I am looking forward to working with Kiwi business owners to bring together connections that will make the difference to their success, and being a part of their story will be extremely rewarding.

Arriving back in New York this week after being back in New Zealand for the past 18 months, I see a city embracing the new normal to open up successfully. Bars, restaurants, and entertainment venues are now mandated to require proof of vaccination to enter. Although not required by law, New Yorkers have adopted the ‘be safe’ message and masks are worn in all retail stores. 

While there are many stores and restaurants that have not survived and shuttered because of the pandemic lockdown, there are now new businesses popping up in their place. There are opportunities here for Kiwi entrepreneurs and businesses with cheaper rents and the ability to be part of a country getting back to business. 

New York feels like it is ready to open up and be normal again, and with that come new opportunities. I look forward to sharing insights and the latest export trends with you in the coming months.  

Gary Fortune, Kea North America Regional Director

• AUGUST CASE STUDY – HOW ROCKIT UPSET THE APPLE CART
• INSIGHTS FROM OUR GLOBAL COMMUNITY
• GOVERNMENT UPDATE
• THIS MONTH IN NUMBERS
• GROWTH THROUGH KEA CONNECT
• IN CASE YOU MISSED IT
• TRENDING AT KEA
• UPCOMING EVENTS
• HOW KEA CAN HELP

HOW ROCKIT UPSET THE APPLE CART

From a single seed to almost two million trees worldwide, Rockit^TM apples is a true global success story. The company now has licence to grow their apples in ten different countries and export deals with more than 30 others.

We spoke to GM of Global Marketing, Julian Smith about why New Zealand’s COVID elimination strategy is of benefit to Kiwi export businesses, and how a focus on research and innovation has helped the company take a bite out of the multi billion dollar apple industry.

READ MORE

CHINA

Kiwi fruit and vegetable exporters are being affected by strict new import measures put in place by the Chinese to help control the Asian nation’s regional Delta outbreaks. Our China Regional Director, Ciara Liu explains how the latest virus outbreaks are affecting China’s economic recovery. READ MORE

UK & EUROPE

The European economy is swinging back into motion with the near-term outlook brighter than expected. Our UK and Europe Regional Director, Sara Fogarty tells us which markets are benefiting from consumer’s post lockdown spending spree. READ MORE

NORTH AMERICA

Meet our new North America Regional Director Gary Fortune, he talks to us about his background in the music export industry and why he’s looking forward to establishing new connections and growing Kiwi export businesses. READ MORE

CHANGES TO GOVERNMENT MIQ SYSTEM

The big news for Kea’s offshore community and Kea Connect customers keen to recommence business travel was the announcement of changes to the MIQ system – the broadening of criteria for those who can apply for an emergency allocation, and the piloting of a virtual lobby system. The virtual lobby pilot will kick off once the current pause on vouchers is lifted, with the objective of both increasing transparency and creating a level playing field for those accessing the booking site. 

Following on from the release of the Future Aspirations report data at the end of July, the Kea team have had progress meetings with MBIE’s Small Business Policy, Better for Business and Digital, Data and Insights teams to uncover ways the data might contribute to work underway for each of the teams. Of particular interest were insights around the skills returning Kiwi are bringing back, where in New Zealand they’re likely to settle and how might we connect people to the right roles, advisory opportunities or business investments.

Saya Wahrlich, Global Director, Government & Industry

*Year to date reflects financial year commencing 1 July 2021 to 30 June 2022

SECTORS KEA CONNECT SUPPORTED THIS MONTH

KIWI SOFTWARE FOUNDER TAKES ON NEW CHALLENGE

Upstock provides easy online order management software for buyers & suppliers in the hospitality industry, allowing businesses to handle all their wholesale orders in a simple app.

Managed by a former co-founder of Xero, Upstock is now focusing on growth in Australia. their primary objective is to do foundational market research. This involves speaking with those in the hospitality industry around their current processes and challenges, and receiving feedback on the relevance of their solution.  Upstock sought connections to owners of small restaurants, cafes, and bars around Australia as well as introductions with small F&B producers. They engaged Kea Connect to help start these conversations.

Kea introduced the founder to six individuals: four founders across beverage brands, and two restaurant owners, who were all more than happy to help with feedback and further introductions.

HE TAONGA NO AOTEAROA – A PRECIOUS GIFT FROM NEW ZEALAND

Wai Mānuka is New Zealand’s premium non-alcoholic beverage that infuses mānuka honey with lemon juice and sparkling water. Launched in late 2020, they were the official beverage supplier to America’s Cup and have since picked up local partnerships. Their vision is “He taonga no Aotearoa – a precious gift from NZ.”

As they explore Asia as a key export market, the founders sought guidance from our Kea community, to:

• help provide a broader understanding of F&B landscapes in Asia
• provide feedback on consumer attitudes toward similar products already in-market
• help provide a different lens or perspective, to help them position their brand or unlock opportunities they might not be aware of

INTERNATIONAL BUSINESS AWARDS FINALISTS NAMED

New Zealand Trade and Enterprise have named their finalists for the 2021 International Business Awards. It’s great to see so many Kea Connect businesses in the running.

TOP 5 HOTTEST KIWI BIOTECH STARTUPS

Kea community member Dil Khosa looks at the growing Biotech market and how it will impact our fight against disease. She also names her top five hottest New Zealand biotech startups that you may not have heard of.

ROOM FOR OPTIMISM AROUND LOCKDOWN SPENDING

BNZ chief economist Paul Conway​ explains why the latest lockdown could have less of an economic impact on businesses than March 2020.

VOICES OF THE COMMUNITY

We speak to four offshore Kea community members about how the pandemic has changed their views and what they are doing to stay connected. READ MORE

WHY WELLNESS BENEFITS YOUR BUSINESS

Inspiring offshore Kiwi Graham Perry talks to us about the growing corporate wellness industry and why businesses should be keeping it top of mind right now READ MORE

VOTING, VACCINATIONS AND VACATIONS

Kea community member and TVNZ Foreign Correspondent Anna Burns-Francis shares her stories from behind the camera as she works to keep Kiwi connected to world news  READ MORE

Nominations are now open for the 2022 Kea World Class New Zealand Awards if you know a high achieving industry leader who lends their influence and insight to help Kiwi succeed on the world stage then nominate them HERE

Launching your business in New Zealand. If you’re looking to launch your business in New Zealand then don’t miss our Webinar which will provide crucial market insight and expert advice into Aotearoa’s business ecosystem. SIGN UP

Taking Kiwi Food and Beverage to the world. Join us in Auckland to hear from some of New Zealand’s top food and Beverage exporters including Nick Siu, who was told by investors that his product, avocadomilk, would never sell – it now sits on the shelves of more than 1000 stores across the USA. SIGN UP

Returner meet-ups will be back as soon as Aotearoa returns to Level 1. Keep an eye on our events page and newsletters for the latest information.

China

This month the 8th New Zealand China Business Summit was held in Auckland on 1st August. The participants from the political and business sectors shared their views around the developments in economic and trade cooperation the two companies have made in the past 50 years since the establishment of diplomatic relations. They also shared the ideas that both sides should work together to further expand co-operation in economic and trade in the future.

New Zealand Prime Minister Jacinda Ardern says the relationship between New Zealand and China has deepened over the past 50 years since the establishment of diplomatic relations, and the two countries have become comprehensive strategic partners, making New Zealand-China relations one of the most important bilateral relationships. The Prime Minister says she hopes that the two countries can further strengthen cooperation in areas such as climate change, environmental sustainability and biodiversity, continue to deepen humanistic exchanges and promote business-to-business economic and trade cooperation.

New Zealand Trade Minister Damien O’Connor noted that the Regional Comprehensive Economic Partnership Agreement and the New Zealand-China Free Trade Agreement Upgrade Protocol both came into force this year, which is conducive to deepening economic and trade cooperation between the two countries. Many New Zealand companies are exploring diversified business models and trade platforms in China, with the China International Import Expo (CIIE) becoming an important showcase for New Zealand products to reach the Chinese market.

In mid August, I was lucky enough to meet Ambassador Clare Fearnley at a women leaders dinner in Shanghai. It’s been 4 years since I last met with the Ambassador and we discussed the future opportunities for Kea to work on the ground in China to help the development of SMEs in both countries.

Rebecca Bao, China Regional Director

UK & Europe

This month we have enjoyed the Commonwealth Games in Birmingham, the largest multi-sport
event in the UK since pre-pandemic times. Team New Zealand had an incredible games and we are so proud of our team, their achievements across so many sports and how they represented us on the world sporting stage. Kea NZ team with boarder NZ Inc family were alongside supporting, and via our Kea Connect service we were able to ensure that NZ House at Edgbaston Golf Club was full of delicious New Zealand food and beverages throughout the course of the Games.
We have been fortunate to welcome our Kea CEO Toni Truslove to the market and thoroughly enjoyed spending time with Toni across UK, Amsterdam and Paris with the Kea community. An opportunity to connect with our partners, global community and share updates from home as well as the awesome work that our business leaders are doing across many different sectors.

As summer holidays come to an end, we look to schools returning and bit of normality as we head into autumn and festive season. Traditionally September is a time of change for many, those seeking new opportunities after the summer and we are seeing many exciting roles being advertised. Compounded by labour shortages, the market is competitive out there for
great people looking to head this way. Within this crowded market, a few of our New Zealand companies here have put together some creative ways to attract great talent and those from home. The team at Ozone Coffee Roasters – started by two Kiwis in the small surf town, Taranaki, are a close-knit, diverse family, 200 people strong in the UK & NZ. They are looking to have Kiwi chefs join their London operations and offering to pay flights to London on the completion of a
successful probation period and minimum sign up period of a year. The Heist Group – which owns Specialist Cellars and The Laundry in Brixton has also taken the costly move to register themselves to be able to sponsor Kiwi to the UK with visa assistance.

Offices are starting to fill up and busier Tuesday – Thursday, with Monday & Fridays becoming the norm to be working from home. A recent survey suggests that workers in the UK are going into the office on average 1.5 days per week, with only 13% in the office on a Friday. Consultancy Advanced Workplace Associates surveyed 43 offices in the UK, representing nearly 50,000 people, in June and July. It suggests average attendance was 29%, with a peak of 39% mid-week. Something to consider for our kiwi exporters looking to engage with partners and customers on market visits and also when they are investigating setting up operations here.

This week we said a fond goodbye to our High Commissioner, HE. Bede Corry as he heads to USA to take up the Ambassador post in Washington. It has been such a privilege to be a part of his UK journey here and look forward to seeing the great work he will do with Gary in the USA.

Sara Fogarty, Kea UK/Europe Regional Director

North America

It has been a busy month for NZ activity in New York. The inaugural Air NZ flight from Auckland to New York is fast approaching, and the new service has had an extensive PR campaign city-wide. Bryant Park in midtown showed a revolving loop of picturesque imagery from NZ and yellow city cabs with digital screens on their roofs also displaying a slice of NZ speeding down city streets. Direct flights will be a game changer for Kiwis heading to the US, and with the UK and Europe a short distance away, NZ 1 and 2 will be kept busy with both NZ business and vacation travelers. The flight times are long but the convenience of getting on in Auckland and landing in New York City will cure the jet lag quickly.

As exporters target this market and plan trips abroad, it is worth remembering that the US and Europe are on vacation during July and August. This time of the year is like our Christmas; schools finish at the end of June people head away to their summer holiday homes and travel abroad. Schools are back around the end of August. It can be difficult to secure meetings and get people’s attention, so if this is your only window to travel, it is worth planning any meetings well in advance. I have been asked about recruitment trends in the US as new companies set up offices in this part of the world. We saw the great resignation last year as the pandemic pushed workers to rethink their career paths, work conditions, and long-term goals. As many workplaces start to bring their employees back to the office, they are offering more flexible options as workers have come to expect the freedom that remote work afforded them during the pandemic. People looking for new roles want to know that companies align with their values more, embrace diversity, and allow the flexibility of remote working as needed, this is the new normal.

Gary Fortune, Kea North America Regional Director

New Zealand

In good news for businesses relying on the tourism dollar, this month saw the return of cruise ships to our waters and new data from Statistics New Zealand and MBIE show a strong uptick in international visitor numbers and overseas card spend, with June 2022 seeing the highest number of international visitor arrivals since the border was closed in March 2020.

Since our borders fully reopened, working holiday makers have also started to return, with approximately 4,000 already in country and over 21,000 have had their application to work here approved. The Government is taking steps to help relieve workforce shortages facing New Zealand businesses in a series of measures announced mid August. These measures include:

• Additional workers able to enter country for sectors affected by international labour shortages
• Aged care, construction and infrastructure, meat processing, seafood, seasonal snow and adventure tourism sector agreements put in place
• Doubling of Working Holiday Scheme cap for 2022/23 will see an extra 12,000 working holiday makers able to enter New Zealand
• Onshore working holiday makers visas expiring between 26 August 2022 and 31 May 2023 will be extended for 6 months to keep workers that are already in country, and those offshore given more time to travel.

For businesses planning to export to Australia, New Zealand Story commissioned a country perception research study to understand the opportunities offered to New Zealand exporters. The report was released last month and highlights major perception shifts since the previous research in 2015. Australia is one of the most accessible international markets for New Zealand businesses to enter, and in 2022 Australia’s view of itself is changing – influencing its growing admiration for the values it perceives New Zealand represents. 

This month MFAT opened consultation on New Zealand’s Export Controls regime which controls the export of strategic and certain other military end-use goods and technology, in line with New Zealand’s domestic and international obligations and commitments. The Ministry is encouraging participation from exporters, universities and researchers, civil society, and Māori, including iwi and hapū as Treaty partners. Have your say before 14 September. 

Saya Wahrlich, Global Director, Government & Industry