Exporters show resilience

“The ExportNZ 2012 Survey shows the majority of exporters are still in a positive frame of mind despite exchange rate challenges and the lacklustre growth affecting some parts of the world economy”, says Catherine Beard, Executive Director of ExportNZ.

Just over half the respondents (51.8%) expected their profitability to improve in the next 12 months and 35.7% expect to employ more people. Over the next 12 months, 19.6% expect their orders to rise substantially and 48.8% said they expected orders to rise slowly.

The top five export destinations for respondents were Australia, North America, Europe (incl UK), China (incl Hong Kong) and ASEAN.

The sample size was 169 responses with a good cross section of the export sector regarding size; with around 70% employing 50 people or less, and 30% employing 50 people or more.

When asked about the main obstacles to exporting or exporting more, the top four issues were:

1. Demand offshore 

2. Exchange rate volatility 

3. Funding for developing export markets 

4. Price competitiveness of their products. 

When asked about regulatory barriers to export, the problems faced were more in overseas markets (34.1% said yes) than in New Zealand (13.3% mentioned domestic barriers).

The overseas barriers are mainly around issues such as tariffs, product registration, bureaucracy and non-tariff barriers.

The domestic barriers mentioned included treatment of the export of education services (NZQA and immigration rules), food safety transaction costs, phytosanitary and AQIS costs and export freight costs.

The Ports of Auckland dispute affected 28% of Auckland respondents negatively and 15% of Tauranga exporters.  Dollar figure losses ranged from $5,000-250,000, with one respondent having lost $4,000 a week.  

When asked if the Government was doing enough to support exporting 61.3% said no (down from 65% last year) and when asked what kind of Government assistance was favoured, the majority said Export Market Development, followed by R&D assistance. When asked more generally what the priority issues were, development or venture capital was most important, followed by export market development and R&D.

Beard said the emphasis on more help needed for export market development probably reflects the fact that many of our exporters are relatively small by world standards. While 24% of respondents said capital was no constraint at all, for around 32% it is a real constraint.

The regions where respondents said they expected most growth were Australia, North America and China, and 40% of respondents expect to enter new markets in the next 12 months, which is encouraging.

Beard said it was good to see the resilience of the export sector in the survey results, particularly given the global slowdown and the volatile dollar.

“There is a significant list non-tariff barriers that exporters are battling and ExportNZ is keen to work with government officials to tackle them.”

For the full report go to: http://www.exportnz.org.nz/__data/assets/pdf_file/0006/50559/2012-Exporter-Survey-Findings.pdf