New Zealand Overview Nick Arathimos Investment New Zealand Investment New Zealand

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New Zealand Overview Nick Arathimos Investment New Zealand Investment New Zealand Slide 2 What is Investment New Zealand? New Zealands investment promotion agency A division of Trade NZ Facilitates foreign direct investment (FDI) We give you the inside running Slide 3 New Zealand - Key Facts Population - 3.8 million Land area - 271,000 sq. km (about the same size as UK or Japan) Currency 1 NZ$ = 43 cents USD 1 NZ$ = HK$3.40 Slide 4 New Zealand Economy Deregulated Prices are market driven rather than determined by the government Free movement of money in & out of NZ Deregulated employment market More than farming Slide 5 Business in NZ Transparency in business processes Efficient, open & honest bureaucracy Just do it attitude Simple low tax structure Economic growth combined with low inflation Democratic Slide 6 Percentage Contribution to GDP by Economic Activity Manufacturing18.2% Tourism15.9% Finance14.7% Transport8.4% Mining8% Software7.2% Agriculture and Fishing5.8% Slide 7 GDP Growth Slide 8 Whats NZ like for Business ? 8 Universities, 20 + Polytechnics 8 Crown Research Institutes Professional and skilled workers Competitive costs c30% lower than Australia Robust, modern infrastructure Slide 9 EXPORT = LIFE Exports USD 10 billion = 30 % g.d.p Free Market with Australia = 23 million Singapore on board Hong Kong under negotiation USA, Chile, ASEAN? Slide 10 Where Do The $s Come From? Visible Exports Dairy, Meat, Wood and Wool - 65% Added Value Manufacturing - 25% Invisible Exports Tourism, Software and Consultancy Slide 11 Big Four Global Markets Australia USA UK Japan Slide 12 Taxation in NZ Main taxes are Income Tax and Goods and Services Tax (GST) Personal Tax Rates: 15% on income NZ$0- $9,500 21% on NZ $9500- $38,000 33% on income NZ$ 38,000- $60,000 39% above NZ$60,000 GST applies at a uniform rate of 12.5% Company Tax 33% Slide 13 IT Industry in NZ NZ IT Valued at $9.5 billion Approximately 50,000 employed in IT 4,500 IT students in NZ Universities 1,500 graduates annually 40% increase in graduates since 1998 Trend encouraged by Government Slide 14 Software Services and Exports Slide 15 New Zealand - Ideal Test Market Cost-effective testing Scaleable demographics Sophisticated market of early adopters A season ahead of the Northern Hemisphere Slide 16 Fertile Biotechnology Environment Relatively disease free animal health status New Zealand - the premier location for producing human pharmaceuticals through farm animals High quality and cost competitive Government and university research facilities A science community with strong international linkages Research focuses on both agbiotech and human health Slide 17 Fertile Biotechnology Environment Biological sciences are a strength of New Zealand tertiary education sector New Zealand produces more graduates in biology than any other science discipline New Zealand has a deep resource of people with intellectual capital in the biological sciences Slide 18 Back Office Processing (SSC) New Zealand represents a cost effective location compared to other Western countries for both labour and infrastructure costs New Zealand has international and national telecommunications infrastructure to undertake cross border back office processing operations New Zealand employees are customer service centric New Zealand provides a 24x7 work force Slide 19 Back Office Processing (SSC) Total annual operating costs for a 100 person, transaction processing back office facility, percentage cost saving in Auckland compared to Australian and US locations Slide 20 Investment Overview New Zealand welcomes investment from international companies Seeks to build on and complement the relationship with its trading partners Slide 21 Ease of Starting a New Business 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 Italy Japan Germany France Denmark Sweden Australia Ireland Netherlands Britain Finland Canada New Zealand United States Source: The Economist October 1999 Slide 22 Venture Capital High business birth rate - 22.7 % 96 % of companies employ less than 20 people Deal flow = 400 for first 5 months 2001 Less than 5 % invested Slide 23 Venture Capital Returns = 25 - 40% p.a. No capital gains tax NZD 500 m 1 b invested + same available = 0.8 % of private capital investment (US 2.4%) Slide 24 Opportunities Funding and management collaborations Client / investee company synergies, e.g: Wireless communications and the Internet 3D imaging and computer animation Genetics and biopharmaceuticals High tech niche manufacturing