If New Zealand is to achieve the financial prosperity we aspire to it is important that all aspects of our economy are delivering world class returns.
The Māori economy is clearly a focus for government and rightly so. Its asset base of approximately $40bn is somewhat fragmented, heavily biased toward property and primary industry, and in general under-utilised.
There were a number of research and development and tourism initiatives announced in Budget 2014 aimed at economic development within the Māori economy to generate better financial returns. While these initiatives are a start, they fall short in terms of the quantum and follow through required to really make a difference. So what else is needed?
First, if we are serious about being an export led economy then more money, public and private, needs to support science, research and development to generate ideas and encourage innovative business opportunities.
There needs to be a shift away from the traditional passive income streams like interest and rents that attach to forestry, farming and land assets that make up a significant component of the Māori economic asset base.
Second, we need to ensure that the new ideas and business opportunities generated from any additional investment are able to be commercialised into real businesses - it is not just about the idea but the execution. The Māori economy, and therefore New Zealand Inc, only stands to benefit if the business ideas and opportunities arising from these new investments lead to job creation and better financial returns. In particular, one area that could be improved by additional investment is the development of sound business cases and plans for the commercialisation of these ideas and innovative business opportunities.
Finally, we need greater collaboration within the Māori economy. The protracted nature of the treaty settlement process means that there are still a significant number of iwi that are yet to receive their settlement. We need the larger iwi who have already received their settlement, or Māori organisations that have well established governance and business activities, to lead the collaboration and commercialisation of Māori economic assets with other newly settled iwi so that the assets can be employed more effectively and more quickly. Many Māori organisations hold modest and fragmented asset bases and do not have significant financial resources available to them. This means that often investment opportunities are too large or costly for these smaller Māori organisations unless they collaborate.
Additionally, there is room for more direct support by central government for regional collaboration between Māori and non-Māori organisations, economic development agencies and local government to ensure that the economic benefits from collaboration can be realised on a regional basis.
The Māori economic asset base is a significant part of the New Zealand economy and growing. Better financial and social outcomes for Māori, and all New Zealanders, rely on a high performing economy underpinned by a strong Māori economy.