New Zealand Exporters Continue to Show Resilience Amid Rising Costs and Geopolitical Tensions
The latest ExportNZ/DHL Export Barometer Report 2024 paints a dynamic and encouraging picture of New Zealand’s export landscape. Despite facing significant headwinds—such as increased costs, geopolitical tensions, and domestic regulatory barriers—Kiwi exporters have shown remarkable resilience and adaptability.
Positive Growth with Challenges Ahead
According to the report, an overwhelming number of respondents (271 companies) reported increased export sales over the past 12 months. A net 18% of exporters saw increased export volumes, and a net 51% anticipated continued growth over the next year. Australia, the USA, and Europe remain the top export markets, but there is also growing activity in newer markets, including the UK and the ASEAN region. The completion of Free Trade Agreements (FTAs) with the UK and EU has bolstered this trend, with an increase in exports to the USA also contributing to diversification.
While exporters are optimistic, they also face increasing costs, particularly in logistics and supply chain management. 89% of respondents reported rising operational costs, with 40% experiencing increases of 20% or more. Supply chain disruptions, exacerbated by geopolitical tensions and global shipping issues, have only heightened these challenges. Many businesses indicated that delays in shipping and higher costs are causing significant concern. One Canterbury manufacturer highlighted the unsustainable cost of exporting from New Zealand, leading some companies to consider moving manufacturing closer to their key markets.
Adapting to Global Changes
Despite these challenges, exporters are implementing strategies to combat cost pressures and other barriers. The report shows that many respondents changed logistics providers, improved internal processes, and shifted production closer to key markets. Additionally, 31% of respondents entered new markets, a marked increase from the previous year.
Innovation remains at the heart of their response to adversity. Many exporters are investing in research and development (R&D), new sales and marketing approaches, and enhancing their online presence. The growing use of online platforms like company websites, Facebook, and Instagram underscores a shift towards digital engagement with international customers.
What More Can Be Done?
While exporters are doing their part, the report also highlights areas where government support could be increased. There is a growing call for assistance in attending trade shows, accessing market research, and receiving better support from New Zealand Trade and Enterprise (NZTE). Many exporters expressed a need for more coordinated "NZ Inc." branding at international events, which could help them stand out in highly competitive markets. Moreover, there is rising demand for government efforts to reduce compliance and logistics costs, which would significantly enhance the competitiveness of New Zealand goods globally.
Sustainability Rising as a Priority
Sustainability in logistics and supply chain decisions is becoming increasingly important for Kiwi exporters. While 63% of businesses indicated that sustainability is a priority, most have yet to implement specific goals. This points to a growing awareness and a need for more significant guidance on turning sustainability aspirations into tangible action.
Key Takeaway
The ExportNZ/DHL Export Barometer Report 2024 showcases the strength and determination of New Zealand’s exporters in an increasingly complex global market. While they face rising costs and barriers, their proactive strategies, focus on innovation, and resilience set a strong foundation for continued growth. With increased government support and a shared focus on sustainability, New Zealand exporters can continue to thrive on the global stage.
As the global landscape continues to evolve, New Zealand businesses will need to stay agile, and the importance of strategic partnerships, innovation, and government support will only grow.
Download a PDF of the Full Report: ExportNZ & DHL Export Barometer Report 2024