The recommendation to triple foreign investment had been made in a recent report compiled by the Ministry of Economic Development (MED) as a solution to the country’s quest to triple its export market in the next 15 years.
The MED said that achieve such growth, industrywould need to turn ingredients into processed foods; a costly move.
However, Katherine Rich, chief executive of the NZFGC, told FoodNavigator-Asia that tripling foreign investment in the food and beverage sector is an ambitious goal in the present economic climate.
“If there is one area of the economy, which has been less pummeled by the global financial crisis, it’s the [New Zealand] food industry, but even then the effects have been felt,” she pointed out.
The continued talk about ‘adding value’ to New Zealand’s commodity products is something long discussed, she said, but it’s easier uttered than implemented.
However, there are some firms investing, she said, and “what heartens me is when I see companies like ANZCO and Silver Fern Farms investing heavily in developing their brands and new innovative products.”
The farmer’s cooperative model is good
Silver Fern Farms is farmer’s cooperative and leading local procurer, processor and marketer of sheep, lamb, beef and venison, she detailed, and it has been able to evolve a production-based strategy to a market-led one.
“Companies like them and others like Cerebos, Hansells and Tasti work extremely hard to further process goods produced in New Zealand. As a country we always do more,” she said.
“Cooperative models have some significant strengths and some known limitations. Good businesspeople capitalize on the strengths and work around the limitations,” she added.
However, many sector commentators have said that it is the abundance of these business models holding the country’s food sector back, as they are not commercially owned.
Off-putting foreign investor environment?
Crafar Farms was recently taken over by China-based Shanghai Pengzin Group, and it has been reported that at a local level there has been some resistance but Rich said this would not ‘scare’ potential investors.
“The Government ended up backing the deal and publicly defending it. Our Prime Minister John Key and Trade Minister, Tim Groser have made it crystal clear that New Zealand welcomes investment as long as it meets our strict rules,” she said.
