Food and Beverage Export Programme Announced - Minister for Economic Development Media Statement

Economic Development Minister Trevor Mallard today launched the government's work programme for partnering with industry to grow New Zealand's high-value food and beverage exports.

The work programme of six key initiatives includes $19 million for in-market assistance for the sector offshore and is the government's response to last year's Food and Beverage Taskforce report "Smart Food, Cool Beverage".

"Thanks to its innovation and scale, the food and beverage sector will continue to have a long term and major positive impact on New Zealand's economy," Trevor Mallard said at the launch of the programme at Villa Maria Winery in Auckland today.

"This sector is central to New Zealand's economic performance – half of New Zealand's exports are food-related and the sector employs one-in-five people. The growth in the sector's productivity in both on-farm production and in food manufacturing has been consistently above the average for the whole economy.

"Just as important, the strength of this sector has provided a platform for the development of a whole range of associated high-value industries: for example our strength in dairy commodities provides a critical foundation to develop specialist high-value dairy products. We also have huge potential in the functional foods area – foods with scientifically-substantiated additional health benefits.
 
"When we talk about economic transformation, this is what we mean – using our existing strengths and capabilities to move into high-value but related areas of export activity that deliver us higher wages and a better standard of living.

"What is also clear is the strong need for the private sector to think about partnering and collaboration – working with each other and also alongside government agencies and research institutions to help drive growth for food and beverage exports.

"It is also appropriate, given it is Export Year,  that the initiatives I am announcing today are all aimed at lifting exports and helping grow more firms that are export-capable and internationally competitive in this area.

"Export Year is also about government partnering and collaborating with industry sectors to lift New Zealand's exports long-term – and this is also a key message that the taskforce report emphasised, and which I also want to, as we work together to achieve sustainable growth in this area."

The six key projects that make up the government response to the taskforce report are:

• $19 million of additional funding to expand in-market assistance for New Zealand food and beverage firms to develop new markets
• Improving infrastructure for new product development to help test and develop innovative food products;
• Increasing  the business capability of food and beverage exporters through an audit and mentoring programme;
• Raising productivity and sustainability in pastoral industries;
• Producing a Food and Beverage Research Roadmap that sets the directions for food innovation research; and
• Implementing the taskforce's Skills Action Plan through a joint government/industry body to oversee and support it.

This package is on top of budget and other recent initiatives that assist this sector:

• Research and development (R&D) tax credit  and other business tax changes
• $8 million for climate change research
• $12 million additional funding for Pastoral 21
• $8 million for research into increasing productivity and sustainability across primary sectors
• $14 million for research into innovative foods and other products
• $37.4 million investment in biosecurity 
• Expansion to market development assistance grants
• The Riddet Centre in Palmerston North has recently been recognised as a Centre of Research Excellence with $20 million of funding

Fact sheets for each project, the government's vision statement for the sector and the cabinet paper are on the MED website. The taskforce report is on the NZTE website.

Background to the Food and Beverage Taskforce

The taskforce was established as part of the government's sector engagement policy and in recognition of the sector's ongoing importance to New Zealand's future economic development. It was asked to help shape strategic thinking in the sector, inform government policy and put together a development agenda for the sector's future.

The taskforce comprised 17 people from a cross section of the sector. It was co-chaired by the Minister for Economic Development and Tony Nowell who was Managing Director of Griffins Foods Ltd at the time, and is now CEO of Zespri. Other taskforce members included representatives from companies in the sector, academics, government agencies, food writers, workers representatives, research scientists, producers and the Minister of Agriculture and Forestry.

The taskforce report Smart Food, Cool Beverage, New Zealand's Future in the Food and Beverage Sector recommended an overarching strategy of protecting and enhancing the sector's existing base and strengths by taking actions to enable continued growth of five per cent per annum in the face of increasing challenges, while at the same time addressing:

• the need to develop new higher-value products, particularly to capture a share of the growing functional-foods market; and
• the need to develop new markets, particularly focusing on the emerging high growth markets in Asia.

The government responded to the taskforce recommendations under the initiatives and projects outlined above.

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