Given its comparative geographical isolation, it makes sense for NZ to invest in it's digital economy.
NZ has its own competitive advantages:
(1) An educated population;
(2) An English-speaking population (yes, this is an advantage. Regardless of the rise of the East, English is still the international language of business.)
But, clearly, it has certain disadvantages. Geographical isolation is one of those. It is difficult to close your trade deficit efficiently if your manufacturers are pummelled by shipping costs (and expensive labour costs). It's products are almost always going to be more expensive than it's competitors.
So, what should NZ do?
An obvious solution would be to invest in intangible exports (that's the technical terms for non-physical exports); exports that will bring money and jobs into NZ without having to saddle the costs of shipping.
This is what has happened in most of the west. But in most of Europe, we have invested in financial intangibles rather than digital intangibles. That's gone okay (hmm, okay might be a stretch). But it is unlikely to be the right move for NZ because it hasn't got an established financial center nor access to the Euro markets. (Actually with the rise of the China, which is geographically close to NZ, it might have a go at snapping up some of the renmimbi trade).
What does a country do with a highly educated workforce that needs to export intangibles? Software is the obvious solution.
Invest in Computer Science education at school, write an attractive set of tax laws for digital start-ups, and invest in high-tech infrastructure (i.e, be the first country to roll-out 5G).
In fact, the more I think about the it, the more this makes sense. As NZ is a comparatively small country with few concentrated geographical centres, it could roll-out super-fast broadband, 5G, etc, on the cheap.
> (Actually with the rise of the China, which is geographically close to NZ, it might have a go at snapping up some of the renmimbi trade).
The geographical 'closeness' of New Zealand to China can be overstated. The distance between Auckland and Hong Kong is only slightly less than the distance between Los Angeles and Santiago. I'm not sure that many US Americans would consider Santiago geographically close. The basic fact about New Zealand is that it really is not geographically close to anywhere and this is why it was the last significant habitable chunk of land on the planet to be settled by humans (within the last 1000 years). New Zealand is actually very close to the centre of the 'water hemisphere'.
When you say that China is geographically close to NZ, do you mean that it's closer to NZ than other big players like the US and Europe? I ask because I got confused due to the order you listed the countries and thought you were saying that China was closer to NZ than others, and it's not really. Even considering NZ's distance, China isn't too much closer than the US. Wellington to Los Angeles is almost exactly the same distance as Wellington to Beijing, for example.
Paradoxically I'm not sure this is true at all. It turns out that the tyranny of distance can make software even harder to do than tangibles. Why? Because software is intimately driven by domain and end user requirements. It's just not possible to build the right stuff unless you're intimately in contact the people who need it. If you're sitting in NZ, you simply can't appreciate what the driving needs are in an economy 50 - 100 times as big. (Obviously I'm generalising here - there are a few domains where you can - but in general, looking across the vast expanse of the software industry). And it turns out that for those areas where you can do the software remotely - there are nations with billions of people who are seeing the same opportunity.
I code in NZ for a German company. We are very competitive on price compared to Germans, and very competitive on quality, compared to Indians. It's a happy middle ground.
Yep, it can be. So there is a requirement to occasionally work later hours if you liaise with Germany - which is mainly our management and proxy product owners. But with solid backlog groomings, the need to speak to Germany is minimised - if you're grooming a story for next sprint two weeks ahead, any questions can be resolved by email. We run proxy product owners who have responsibility for understanding stories sufficiently to act in the product owner's stead.
That said, the time-zone is an advantage when it comes to deployment - a 4am deployment German time is happily within normal 9 - 5 hours in NZ.
Admittedly, when we travel to Germany for quarterly planning, you realise that being able to walk up to the product owner's office and discuss things in person is far more efficient and far better for resolving things faster. But at the end of the day, we can run 3 Scrum teams in NZ for as much as it cost us to run 1 Scrum team in Munich when we tried it as an experiment - the business team accepts the downsides of distance and time-zone simply for the efficiencies in euros.
I guess that's an upside of being a low-wage economy - we're still competitive despite our stupidly high dollar.
Xero is a NZ startup success story but they have moved their main offices to Australia and the US. Tiny population and geographic and time-zone isolation are big obstacles for anyone trying to do things on a global scale.
As someone in Australia our decrepit internet makes it impossible to do anything resembling a startup. I can't imagine New Zealand would be so bad that they need to move here.
While as a fellow Australia I bemoan the woeful state of our internet, I don't think it makes it "impossible" to start a startup, in fact I know many startups in Sydney and elsewhere. It makes it more difficult, yes, and limits your options, but it's not impossible.
I can think of several reasons to move to AU from NZ as a startup; a greater talent pool and larger investment community for starters. It's by no means a slam dunk, but they're valid reasons.
NZ has its own competitive advantages:
(1) An educated population; (2) An English-speaking population (yes, this is an advantage. Regardless of the rise of the East, English is still the international language of business.)
But, clearly, it has certain disadvantages. Geographical isolation is one of those. It is difficult to close your trade deficit efficiently if your manufacturers are pummelled by shipping costs (and expensive labour costs). It's products are almost always going to be more expensive than it's competitors.
So, what should NZ do?
An obvious solution would be to invest in intangible exports (that's the technical terms for non-physical exports); exports that will bring money and jobs into NZ without having to saddle the costs of shipping.
This is what has happened in most of the west. But in most of Europe, we have invested in financial intangibles rather than digital intangibles. That's gone okay (hmm, okay might be a stretch). But it is unlikely to be the right move for NZ because it hasn't got an established financial center nor access to the Euro markets. (Actually with the rise of the China, which is geographically close to NZ, it might have a go at snapping up some of the renmimbi trade).
What does a country do with a highly educated workforce that needs to export intangibles? Software is the obvious solution.
Invest in Computer Science education at school, write an attractive set of tax laws for digital start-ups, and invest in high-tech infrastructure (i.e, be the first country to roll-out 5G).
In fact, the more I think about the it, the more this makes sense. As NZ is a comparatively small country with few concentrated geographical centres, it could roll-out super-fast broadband, 5G, etc, on the cheap.
Anyways, just a few thoughts.