Global Insights – September 2022

China

After a boiling hot August, China is currently embracing the best season of the year! 

In September, one of country’s the two most important traditional festivals, Mid-Autumn Festival, is celebrated, providing welcome relief from the pandemic. Covid continues to play a big role in China, although overall positive cases remain on a low level. Currently, the Chinese mainland reports around 120 to 150 positive cases per day while Shanghai remains at a low level of positive cases reported in the past 8 weeks. Beijing remains under a strict travel policy to keep the pandemic well controlled for the coming National Holiday in October (aka “the Golden Week”）as well as the preparation for the 20th CPC National Congress which is due to also take place next month. In addition, China reported the 1st case of Monkeypox in the 3rd week of September. The infected Chinese salesman entered Chongqing Municipality and later developed symptoms during central quarantine for COVID-19. Given the lack of vaccines worldwide, the Chinese government has tightened up the entry policy for travellers from overseas and suggests a self-monitoring of 3 weeks upon arrival.  

On Sept 21, I attended the Pure Discovery China Roadshow 2022 in Shanghai. The once-a-year roadshow features more than 60 New Zealand wine brands from eight regions, allowing wine lovers to experience the pure flavours in New Zealand wines, experience the unique terroir of New Zealand and explore the uniqueness and charm of New Zealand’s famous wineries. The roadshow will carry on in Nanjing as the next stop. The Beijing and Shenzhen stops are cancelled due to Covid-19.

In September, I also had the chance to meet with Andrew White, the Regional Director of NZTE, China. Kea looks forward to deepening the complimentary relations with NZTE and other public sectors. More talks with the NZTE team are on the way. I also had an e-meeting with Felix Ye, the Senior Development Manager of Education New Zealand which was equally constructive. I look forward to connecting with more overseas returnees in the Southern China area which is the hub of the education market for New Zealand. I also met with some of the senior figures in the Kiwi community and the Australian community in Shanghai who are keen to get involved in Kea’s projects and events.  

Rebecca Bao, China Regional Director

UK & Europe

The UK is shrouded in uncertainty amid the death of the Queen, the arrival of a new Prime Minister, Liz Truss, and an economy in flux. High inflation, fuelled by rising energy bills, has prompted rising fears of a recession this winter.

UK inflation fell from 10.1% to 9.9% in August, according to the Office of National Statistics, with falling petrol prices being offset by soaring food costs. This is the first time the rate has fallen since September last year. Kitty Ussher, the chief economist at the Institute of Directors, says ‘This will be reassuring to businesses for whomever-rising headline rates are a driving factor behind an overall lack of confidence in the UK economy.’

At its next meeting, the Bank of England is expected to raise interest rates again from 1.75%,
in an attempt to tame inflation. The Sterling fell sharply following a sharp drop in UK retail sales figures, with the pound continuing to struggle against the dollar – and hitting its lowest level since 1985. In recent weeks, it has also lost ground against the euro.

What does this all mean for Kiwi exporters looking to the market – there is uncertainty here and a lot of change. Still a lot of pressure on understanding costs in the short and medium terms, and for exporting partners and distributors, there is still pressure on staffing levels here in the market.
Prime Minister Liz Truss is a strong ally of New Zealand having started the FTA negotiations between NZ & the UK. She and Prime Minister Rt Hon Jacinda Ardern were able to meet last week when Prime Minister Ardern was in London for the Queen’s funeral.

Also this month our community were able to celebrate the World Class New Zealand Awards with a breakfast celebration in London, complete with a live feed into the Auckland event. We were
delighted to award London based, Katie Sadleir with her World Class Award with our partner, Ben Guerin, from Topham Guerin in person and to celebrate with her and her family.

Sara Fogarty, Kea UK/Europe Regional Director

North America

The city has seen a change in Covid rules this month, with mask mandates lifted for all schools and public transport. Although the move was welcomed, many New Yorkers are still choosing to wear masks in the transit system for the time being.

This month has also seen a big jump in office workers returning to the city and businesses increasing their space to accommodate the return of these workers. If NZ exporters are considering office space in the city, there are many options. Co-working spaces exploded in popularity before the pandemic and are an excellent option for companies looking for long or short-term space. A hot desk offers flexibility for teams and is an ideal place for business networking.

This month has seen a hive of activity in the US, and Air New Zealand’s first-ever direct flight to New York City arrived at JFK airport on September 17. Minister Stuart Nash, former Prime Minister Helen Clark, senior Air NZ executives, and a delegation of New Zealand businesses were on the flight to participate in several days of events around the city. Air New Zealand celebrated the arrival by hosting a gala that included NY officials, NY-based Kiwi community members, and a showcase with NZ band Six60 performing with a backdrop of a stunning New York sunset. It was a brilliant NYC & New Zealand experience.

NZTE Investment is currently hosting a group of top NZ investment fund managers on an immersion program throughout the US. It started with two packed days in New York: roundtable sessions on Sunday, including one featuring WCNZer Guy Horrocks, and a full day of activities on Monday. The delegation started early with a special Flat White meet-up featuring Kea member Tessa Gould, CEO of Made by Nacho, in conversation with WCNZer Ronnie Peters. Made by Nacho is celebrity chef Bobby Flay’s cat food start-up which provides sustainable and healthy food options to the vast cat parent population. It was a fascinating peek into the size and opportunity of the pet food business in the US. Later in the day, the delegation had a diversity investment session at Lowenstein Sandler, which was made possible thanks to an introduction by Guy. This was followed by a session at BlackRock, thanks to Kea member Michelle Edkins, Managing Director of Investment Stewardship at BlackRock, who kindly hosted the delegation for a roundtable discussion with several impressive colleagues, alongside Minister Nash; Ambassador to the US, Bede Corry; NZ Consul General and NZTE Trade Commissioner Hannah Lee-Darboe; and NZTE’s GM – Investment, Dylan Lawrence – showing the value of our offshore New Zealanders who want to give back to the community.

Minister Stuart Nash and Dylan Lawrence presented NZTE’s new Investment brand and spoke to the new Active Investor Plus Visa at the end of the day’s activities. The event hosted members of the NY business and investment community to celebrate the launch of the “Do Good, Do Well” campaign and new visa, both of which aim to attract productive, inclusive, and sustainable investment opportunities to drive economic benefit for the good of New Zealand. The Air New Zealand flight will undoubtedly open new opportunities for NZ businesses travelling to this part of the world, and I look forward to welcoming more of our exporters in the coming months.

Gary Fortune, Kea North America Regional Director

New Zealand

The news this month was dominated by the passing of Queen Elizabeth II. Community representatives chosen in recognition of the late Queen’s commitment to service joined world leaders and official representatives in making their way to London to attend the State Funeral. 

Resulting scheduling changes saw Prime Minister Jacinda Ardern being asked by Prince William to speak on his behalf in New York at a climate change charity he is a co-founder of along with Sir David Attenborough. The charity is Earthshot Prize – an environmental charity that finds and funds innovative solutions to environmental problems. Outside of this, her primary focus at the UN General Assembly in New York is climate change, mis and disinformation, and online extremism. The centrepiece of this programme is a Christchurch Call summit, which is jointly hosted with French President Emmanuel Macron. Under the banner of the Christchurch Call, New Zealand, the USA, Twitter, and Microsoft announced an investment in a technology innovation initiative. This initiative will support the creation of new technology to understand the impacts of algorithms on people’s online experiences, empowering independent researchers to help build safer platforms and more effective interventions to protect people both online and offline.

This month saw a continued high volume of scheduled offshore Ministerial visits with a focus on export growth and values-based investment furthering New Zealand’s economic recovery. The Minister for Trade and Economic Growth, Damien O’Connor visited the US to represent New Zealand at a ministerial meeting on the Indo-Pacific Economic Framework for Prosperity (IPEF). IPEF boosts regional cooperation on a range of future-focused economic, trade and climate issues. Building on the May visit to California where the Prime Minister and California’s Governor Newsom witnessed the signing of a new climate partnership, the visit also includes furthering New Zealand’s relationship with California and supporting sustainable agriculture connections.

Minister O’Connor also visits India this month to showcase New Zealand’s investments in agri-tech, on-farm training, skills development, and climate-responsive farming, and Indonesia to attend the G20 Trade, Investment, and Industry Ministerial Meeting.

The Minister for Economic Development, Stuart Nash, unveiled the InvestNZ Do Good, Do Well initiative at a launch event in New York this week. The campaign is a drive to attract investors to New Zealand that want to take a values-based approach to investment. It makes the connection that those businesses prioritising care of people and place (kaitiakitanga) and using innovation to create solutions to global challenges are more likely to create long-term sustainable returns. Watch the launch video here.

Saya Wahrlich, Global Director, Government & Industry