Akaleidoscopic assortment of goods, technology, consultancy services and innovation now flows into Asia from New Zealand's awakening corporate sector: geothermal technology, luxury yachts and power boats, a host of consultancy contracts, innovative food technology, engineering skills, educational and postal services mingle with carpets, breweries, sportswear, earthquake resistant technologies, hydro-electric schemes, timber homes and airport baggage-handling systems.
Suddenly, it seems, corporate New Zealand has discovered Asia's potential - though not as quickly as some would like. 'I think we're still too insular in our outlook,' says Chris Flavell, managing director of international projects consultancy AsiaPower Developments. 'It's still an uphill battle to interest people in Asia.'
But Asia-oriented activities are widening. New Zealand may have only 3.5 million people, but their skills, ideas and innovations are unlimited, says Dr Saad Al-Harran, assistant professor of Islamic banking and finance at Malaysia's International Islamic University.
Malaysia should develop a 'smart partnership' with New Zealand and tap into its various agricultural developments to help Malaysia's agricultural sector, he suggested to the New Zealand government-funded Asia 2000 Foundation, which promotes business and trade links with Asia.
He suggests collaboration between the two countries' engineers: 'New Zealand's engineers are practical and multiskilled individuals who can operate in a range of sectors with a wide customer base.'
Malaysia's prime minister, Mahathir Mohamad, who led a visit by trade and other officials to New Zealand in March, says there is 'tremendous potential' for both countries to increase bilateral investments, 'particularly in the areas of timber processing, food processing and tourism'. He also called for more effort from both sides to promote investments and form joint venture initiatives in places such as Vietnam, India, Cambodia and China.
Asian countries now make up seven of New Zealand's top 10 export markets. Last year's array of export award-winning and highly commended companies included those delivering products such as ice cream, berry fruit drying technology, telecommunications equipment, engineering services, maritime beacons, furniture, conveyor systems and electromagnets.
'New Zealand's manufacturing sector today is unrecognisable from what it was a decade ago,' says Philip Burdon, minister of trade negotiations. 'It has transformed itself from an almost complete dependence on domestic markets, and on government subsidies and protection, to an internationally competitive force. The pain was great, but the gains have been remarkable.'
In the five years to March 1995, non-primary manufactured output increased by nearly 3% a year, compared with a negative 0.4% a year from 1985 to 1990. 'Manufacturing's world-class performance is being driven by innovative people who identify the needs of overseas consumers and recognise quality, product branding and speed,' says Burdon.
Even New Zealand's appreciating dollar - which recently hit an eight-year high of US 69.1 cents - is unable to hold back development despite growing protests at its value. Last year, manufacturers invested NZ$1.9 billion (US$1.3 billion) in plant and equipment - a 15% increase over average investment in the 1980s.
Lots of know-how other than food
'We're not just a food bowl any more,' says Rick Christie, chief executive of Tradenz, the government's trade development board, which has 16 offices scattered across Asia.
'We have become good in specialised areas. We are a source of very good project management and niche technologies like food and wood processing. We're also good in other areas that Asia didn't realise, like telecommunication products and infrastructure services. We now have a defence engineering capability that would pre-qualify us for any defence contract.
'Export growth is coming from technologically-driven industries. Our major difficulty is the volume restraints on what we can supply to Asian markets.'
New Zealand's government has encouraged this trading trend. From 1984, the country's corporate community found itself facing steady deregulation, which meant the loss of import protection. Then the government focused on New Zealand's 'Asian literacy'. It encouraged multilateral trade and investment. It set up the Asia 2000 Foundation to stimulate business links with Asia. Tradenz expanded its offices across Asia, encouraged joint business groupings to tackle Asian markets - often with Burdon in the lead - trade missions to Asia and participation in Asian trade exhibitions. It also encouraged visits by Asian trade missions and ministers.
'The government is creating a vanguard for changing attitudes, showing that Asia is not only investing profitably in New Zealand, but that New Zealand can also invest profitably in Asia,' says Doug Myers, chief executive officer of the brewery group, Lion Nathan. 'Just a couple of years ago, the very thought of being in Asia would have terrified corporate leaders.'
Business councils - under the umbrella organisation, New Zealand International Business Councils (NZIBC) - form links with counterpart bodies in Asian countries to short-circuit inevitable bureaucratic blockages and identify opportunities. Overseas companies invest capital in local operators to launch products into Asia. New Zealanders form joint ventures or switch production off-shore, and companies form consortiums to pool their skills and pack a bigger competitive punch.
Consultancies provide credibility
New Zealand consultancies operate from Mongolia to the Maldives and from Taiwan to Vietnam and India. 'Consult-ancies provide New Zealand with a profile and a new level of credibility,' says Rob McLagan, executive director of NZIBC.
ENEX of New Zealand is a cooperative of consulting companies that draws on about 3,000 specialists. One of its biggest members, Beca International Consultants, with a staff of 1,200, has been in Asia for 20 years. It provides engineering services in the food and beverage, forestry, energy, mechanical and electrical industries.
A smaller ENEX member, Oakley Pinfold Turvey International, has designed and supervised construction of a fishing harbour and processing plant in the Maldives, where KPMG Peat Marwick's New Zealand operation has been developing a public sector reform programme.
Other consortiums are scoring successes, too. AsiaPower Developments is putting together an international consortium with development rights to build a US$1.1 billion, 960 megawatt power project in India using existing dams on the Upper Krishna river.
AsiaPower is a consortium made up of merchant banker Southpac Corp, investment company Brierley Investments and electricity and telecommunications specialist DesignPower New Zealand.
'New Zealand has an advantage in geo-thermal and hydro-electric generation,' says AsiaPower's Flavell. 'It has a relatively low-tech approach to structural developments at a relatively low cost. That's different to the gold plate approach of other countries, which may recommend a technical answer that has a far greater degree of sophistication than the user requires. Geothermal energy is all about the quantity of electricity output for the dollars put in.'
Flavell sees more Asian infrastructure specialists in the market. 'Many Asian industrial companies are looking to form joint ventures with companies that can bring with them technology and expertise. That's where opportunities lie.'
AsiaPower has also formed Mandala Nusantara, an Indonesia-registered company with Indonesian and American partners, in a US$600 million project to develop a geothermal field and power station in northwest Java.
Profit-driven government enterprises and others compete internationally as consortiums. Industrial Research, Hort + Research (The Horticulture and Food Research Institute of New Zealand), the Forest Research Institute, Landcare Research and Uniservices (an Auckland University company that specialises in marketing and managing skills and resources) have together won a contract to establish the Sarawak Natural Resource Park on a 2,000-hectare site near Unimas University in Kuching, Malaysia.
'The overall purpose is to transfer technology, communicate to the world Sarawak's opportunities and provide a broader base of science to lift commercial prospects,' says Geoff Todd, Industrial Research business development general manager. 'We believe that Unimas could be a cornerstone for much of the research.'
Following last year's Kobe earthquake, Japanese developers have renewed demands for Industrial Research's constantly improving lead rubber bearings, which damp the impact of earthquakes. And there is increased Japanese interest in New Zealand kitset wood-framed homes.
International food giant HJ Heinz reflects the aspirations of international investors in New Zealand. It spotted the twin value of New Zealand's food production and its proximity to Asian markets some time ago. Heinz took over the operations of food firm Wattie that market canned food, frozen food and ice-cream.
Tailoring food to suit Asia
Local food and beverage processors point to two major competitive advantages - access to high quality raw materials and flexible and adaptable manufacturing systems that can produce short runs of highly specific food products that meet offshore recipe needs.
Tip Top, a division of Heinz Wattie, won last year's supreme export award. It tailored the taste of a milk-based product to Japanese palates and lifted sales there to NZ$30 million. In two years the managing director, Ray O'Connor, hopes to reach NZ$50 million ÐÐ that's just 1% of Japan's NZ$7 billion ice-cream market.
Tailoring food for Asian palates is part of Hort + Research's role. 'We use a sensory science which screens products so they meet overseas market needs,' says Norman Lodge. 'We also have the ability to do this for Asian products exported to Europe.'
Hort + Research is also improving Asian product yields and quality, providing crop-storing technology and reducing the use of chemicals so that Asian food exports meet international standards. Its scientists are working with their Chinese counterparts to devise a more efficient storage system in China for apples, which have traditionally been stored in caves.
New Zealand scientists, with their expertise in refrigeration techniques, are helping to make the existing Chinese method more efficient. They are also setting up a training and development centre in China's apple-growing western Henan province, and developing a feasibility study for an apple project in northeast India.
Lion Nathan is operating successfully in China after investing US$22 million last year for an 80% interest in a joint venture company that owns the Taihushui brewery in Wuxi. Lion Nathan plans to double Taihushui's capacity over the next year and to set up a new brewery in Suzhou.
Myers is not fazed by China's turbulent economy. 'Turbulence is familiar territory for us. As survivors of an economic meltdown [in New Zealand], we have not only emerged tougher and more resilient, but also attuned to the opportunities only turbulence can bring,' he says.