NZ Fry Up: How NZ climate tech can take on the world; Should NZ emulate Israel or Canada for tech innovation?

New Zealand IT, tech, and telco news and views from our editor in Auckland.

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How NZ climate tech could take on the world

Along with a proliferation of ‘xtechs’ (as in fintech, agritech, etc.) are the reports about them and the agencies involved to cater to them. You can rely on Computerworld New Zealand to read pretty much every tech-related report publicly released in New Zealand—every single one of them—and so we come to this week’s feature xtech: ‘cleantech’, also known as ‘climate tech’ and ‘environmental technology’. Callaghan Innovation’s report “New Zealand Climate Tech for the World” delves into this emerging area of specialty tech innovations.

The report is based on 98 environmental technology businesses funded by Callaghan Innovation in the 2020 financial year. According to the agency, these businesses “collected $334 million in revenue, supported 1,860 jobs, and invested $95 million in R&D, with 680 high-value R&D jobs specifically.” On the face of it that looks good, but it’s not quite good enough when it comes to export revenue.

Callaghan Innovation environmental technology lead James Muir says there needs to be a more coordinated approach to taking on the world—and the way to do it is to look at creating ‘innovation outposts’, which in this case, would be California’s San Francisco Bay Area, China’s Shenzen, the Netherlands, and Israel. They would focus on specific markets, and research what environmental problem large companies in these countries have and then provide the solution to it.

By ‘they’, Muir means New Zealand Trade and Enterprise, the agency charged with finding and developing global markets for local companies. “What we would then get is a much greater connection between the New Zealand cleantech ecosystem and very large customers overseas. So actually solving for a problem that a large organisation owns overseas is kind of the nirvana of this. We spend quite a lot of time in New Zealand and other places creating solutions to problems that aren’t necessarily there,” he says.

There is plenty that IT professionals can do to help in this area, such as actively seeking out local innovators to work alongside. You can find out more over at CIO New Zealand, where Muir outlines the new approach to boosting the environmental technology ecosystem.

Avoiding duplicate innovation efforts among government agencies

There are only so many tech reports the team of 5 million needs, and in reading the Callaghan environmental technology report—which also discusses opportunities in the agritech sector in some depth—there was the sense that there might be a duplication of effort.

Not so, according to Muir. “I think it’s a really fair question, but we work really hard to make sure that’s not the case. For example, on the Agritech ITP [Industry Transformation Plan], I work very closely with the agritech team, and they have a clear strategy about cleantech,” Muir says.

The report is about bringing the issues to the fore, while actually carrying out a programme of activity falls to those involved in the Agitech ITP, which is part of the Ministry of Business Innovation and Employment (MBIE). Or, as Muir puts it, “we’ve done the why and the what in this reporting piece, and they are going to the how and the when.”

What is it about Israel and tech compared to NZ?

Fellow tech-report readers will have spotted Israel being mentioned as a country of interest for environmental technology innovators and not have been surprised—it usually pops up in tech ecosystem discussions. According to the Callaghan report, Israel manages its own version of environmental technology in general much better than we in New Zealand do. For example when it comes to funding innovators, Israel’s get 22 times more than their counterparts here.

Israel also gets an honourable mention in NZTech’s report into how to brand Kiwi-made technology, a workstream in the Digital Industry Transformation Plan (basically all the xtechs except agritech) that MBIE is also overseeing. In th NZTech report, Israel is in the company of Singapore, Estonia, and Ireland as countries that “deliver compelling tech and innovation stories”.

Among the reasons provided for Israel’s tech success is its resilient economy, strong academic institutions, advanced manufacturing technologies, “pro-business” stance, and the idea that it is “the world’s spiritual hub for innovation and a powerhouse for revolutionary R&D”.

Which is probably all true, but what isn’t discussed here is that Israel is a very, very different nation than New Zealand. Sure, it is considered a ‘small, advanced economy’ like us, but it spends way more on military, and a lot of tech innovation comes out of defence initiatives. For example, the environmental technology report notes “Israel’s success in agricultural drones built of a larger base of drones proficiency for the defence industry.”

According to Statista, in 2020 Israel, with a population of 9.3 million people, spent US$21.7 billion (NZ$31.2 billion) on its military, while New Zealand, with a population of 5 million, spends about US$3 billion (NZ$4.3 billion) a year on its military.

Should NZ be the Canada of the Southern Hemisphere?

So maybe we should emulate Canada instead? As part of the NZTech report, international investors were invited to comment on the local tech scene, with one offering up the idea that “we are almost ‘the Canada of the Southern Hemisphere’”. (This comment was considered positive.)

In the negative comments section, global investors felt that times zones are bad for business, Kiwis are too relaxed, there is a lack of quality talent, our businesses have low self-confidence, and “innovators often have a weak commercial orientation”.

This may be a fair call, but it hurts.

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