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TOI MOANA BAY of PLENTY GROWTH STUDY: OPPORTUNITIES REPORT May 2015 P R E FA C E

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TOI MOANA BAY of PLENTY GROWTH STUDY: OPPORTUNITIES REPORT May 2015 P R E FA C E MINISTERS’ FOREWORD As Ministers for Economic Development, Primary Industries and Māori Development, we believe strongly that building successful and more resilient regions is key to building a prosperous nation. Recognising and capitalising on the opportunities and strengths of different regions is vital to enable each region to provide employment and a good standard of living for its people and to maximise each region’s contribution to the economic and social wellbeing of New Zealand. The Regional Economic Activity Reports and Enterprise and regional economic (REAR) have allowed us to understand development agencies to bring investment and compare regional performance at a and ultimately employment into the high level. Through the REAR’s, we know regions. that the current economic and social The Bay of Plenty Regional Growth Study performance of regions varies significantly. is the second study in this programme and The Regional Growth Studies programme follows the Northland Regional Growth provides an independent view of specific Study which was released in February regions chosen because their potential is 2015. It provides a view that has been not yet fully realised. Within each of these developed through evidence and with input regions there are excellent success stories from key businesses and economic players and some pockets of high deprivation. This in the region. It provides the region and deprivation can only be fully addressed central government with a shared view through wealth creation and higher levels of the potential of the region and its local of employment. communities. The Regional Growth Studies explore The Bay of Plenty region (that includes opportunities to achieve growth in the Taupo district for the purposes of this investment, incomes and employment by study) is blessed with enviable natural sector. The reports pose the questions endowments, including a favourable “what are the investable opportunities in climate, abundant renewable energy this region and what is stopping investment and water resources from coastal and in them?” lake environments. A wide range of The Regional Growth Studies programme sectors contribute to the current success complements the Government’s Business of the Bay of Plenty region, including Growth Agenda, which works to grow Horticulture, Forestry, Agriculture, and New Zealand businesses, create jobs Tourism. However, there is significant and improve the standard of living for all scope to increase incomes and New Zealanders. employment in the region through sensible investment, increased productivity and The Regional Growth Studies programme increasing the prices we receive for our will also provide a deeper level of exports. information to enable New Zealand Trade i MINISTERS’ FOREWORD continued The Government is also committed to enormous, though still largely untapped. raising Māori economic performance. This report, and He Kai Kei Aku Ringa, Achieving the goals of He kai kei aku complements the common goals for Māori ringa: the Crown-Māori Economic Growth economic development in this region, as Partnership will be realised if action is set out in He Mauri Ohooho. taken in those regions where there are We are committed to maintaining and larger Māori populations. The Bay of building on the strong partnerships Plenty also has the benefit of a significant established in this region and, through youthful Māori population. the development of a Regional Economic He kai kei aku ringa literally means Action Plan, to further explore and providing the food you need with your realise opportunities identified in the own hands. This concept of economic report. Realising opportunities will independence or self-sufficiency is a only be successful, if all stakeholders fundamental principle for Māori, who look pull together to do what is right for the to the best interests of and outcomes for region – not just individual sub-regions or whānau. sectors. The full potential growth in this region will To be successful, the Regional Growth only be achieved if iwi/Māori actively work Study will also need to inform and inspire to raise the utilisation and productivity of industry, iwi and Māori, and central and their land and increase skills, employment local government to act individually and and incomes of the region’s poorest collectively to turn opportunities into whānau. Working hand in hand with local realities. and central government, we believe the We welcome this report and its findings. potential benefits for the country from such a collaborative approach to be Hon Steven Joyce Hon Nathan Guy Hon Te Ururoa Flavell Minister for Economic Minister for Primary Minister for Māori Development Development Industries Minister for Whānau Ora Minister of Science and Minister for Racing Associate Minister for Economic Innovation Development Minister for Tertiary Education, Skills and Employment Minister for Regulatory Reform Associate Minister of Finance ii TOI MOANA BAY OF PLENTY GROWTH STUDY: OPPORTUNITIES REPORT May 2015 P R E FA C E This report has been prepared for the Ministry of Business, Innovation and Employment and the Ministry for Primary Industries by Ulf Schoefisch, Stephen Knuckey, Jason Leung-Wai, Melissa Hall and Sally Baguley from MartinJenkins (Martin, Jenkins & Associates Limited), Richard Paling from Richard Paling Consulting, and Heta Hudson from Crowe Horwarth. MartinJenkins advises clients in the public, private and not-for-profit sectors, providing services in these areas: » Public policy » Evaluation and research » Strategy and investment » Performance improvement and monitoring » Organisational improvement » Employment relations » Economic development » Financial and economic analysis. Our aim is to provide an integrated and comprehensive response to client needs – connecting our skill sets and applying fresh thinking to lift performance. MartinJenkins is a privately owned New Zealand limited liability company. We have offices in Wellington and Auckland. The company was established in 1993 and is governed by a Board made up of executive directors Doug Martin, Kevin Jenkins, Michael Mills, Nick Davis and Nick Hill, plus independent directors Peter Taylor (Chair) and Sir John Wells. Data from Infometrics was provided to MartinJenkins for use in this report. Infometrics specialises in providing economic and employment data from both an industry and regional perspective via a web-based system. Infometrics is a privately owned and operated company based in Wellington and was founded in 1983. iii ACKNOWLEDGEMENTS MBIE and MPI would like to thank the following people for their valued contribution in completing this report: REGIONAL TECHNICAL ADVISORY GROUP: Fiona McTavish (Chair), Andrew Coker, Cheryl MacGregor, Francis Pauwels, Fritz Frohlke, Greg Simmonds, Ian McRae, John Galbraith, Mike Barton, Richard Jones, Sarah Strong, Tania Bui, Taria Tāhana, Warren Parker. MARTINJENKINS TEAM: Ulf Schoefisch, Stephen Knuckey, Jason Leung-Wai, Melissa Hall and Sally Baguley (MartinJenkins). Richard Paling (Richard Paling Consulting). Heta Hudson (Crowe Horwarth). iv TOI MOANA BAY OF PLENTY GROWTH STUDY: OPPORTUNITIES REPORT May 2015 CONTENTS Executive summary 1 Priorities for action 22 Introduction 31 Bay of Plenty economic context 39 Overview 41 Economy 45 Māori in the Toi Moana economy 48 Sector selection and opportunity identification 50 Opportunity identification and assessment 52 Sector opportunities 55 Forestry and related processing 57 Agriculture and related processing 73 Horticulture and related processing 84 Aquaculture 106 Visitor economy 117 Specialised manufacturing 128 Enabling opportunities 141 Water management 143 Geothermal energy utilisation 151 Transport infrastructure and digital technology 157 Education and skills 168 Public agency support for the business sector 181 Appendices 185 v TABLES Table 1 Bay of Plenty: Key economic development opportunities 23 Table 2 Bay of Plenty study phases 35 Table 3 Summary table of key sectors in the Bay of Plenty 50 Table 4 Criteria for assessing opportunities 52 Table 5 Forestry and related processing sector summary, Bay of Plenty 58 Table 6 Assessment: Toitū Te Waonui Afforestation Initiative 68 Table 7 Assessment: Development of export markets for processed wood products 70 Table 8 Dairy sector summary, Bay of Plenty 73 Table 9 Meat sector summary, Bay of Plenty 74 Table 10 Assessment: Enhancement of farm productivity 81 Table 11 Assessment: Converting appropriate horticulture land to kiwifruit 90 Table 12 Assessment: International market development 97 Table 13 Assessment: Development of export market for high quality mānuka products 104 Table 14 Aquaculture sector summary, Bay of Plenty 107 Table 15 Assessment: Ōpōtiki sea farm and harbour development 112 Table 16 Assessment: Commercial trout farming 114 Table 17 Assessment: Rotorua wellness-based strategy 122 Table 18 Assessment: Regional tourism strategy 124 Table 19 Specialised manufacturing sector summary, Bay of Plenty 129 Table 20 Assessment: Development of the metal powder and application industry 137 Table 21 Assessment: Progressing the Bay of Plenty regional water framework 148 Table 22 Assessment: Marketing of geothermal opportunities to industry 155 Table 23 Assessment: Tauranga Tertiary Education Precinct 177 Table 24 Assessment: Youth/rangātahi education and skills initiatives 179 FIGURES Figure 1 Toi Moana Bay of Plenty region map 33 Figure 2 GDP growth by region, 2004–2014, percent per annum 41 Figure 3 Population by Bay of Plenty sub-region, 2014 43
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