NZ strikes back

AUSTRALIANS might treat satirist John Clarke, actor Russell Crowe and South Australian Premier Mike Rann as their own, but New Zealand would like them back. They would also like Commonwealth Bank and Telstra bosses Sir Ralph Norris and David Thodey to think about their roots.

The NZ Government is so serious about luring Kiwis home from Australia – professionals and skilled workers, in particular – it has set up a taskforce headed by NZ’s former Reserve Bank governor and Opposition leader, Don Brash – to close the wage and productivity gap between the two countries by 2025.

Last year more than 35,000 New Zealanders moved to Australia permanently, attracted by incomes on average 30.5 per cent higher than in their homeland – 500,000 New Zealanders now live in Australia – 12% of the NZ population. It has the dubious honour of having the highest exodus of skilled people in the OECD.

If the taskforce fails – the Commonwealth of Australia Constitution Act 1900 has a clause that can add New Zealand as another state of Australia. (That should get a rise from our cousins – Editor)

USA gets Small Business STR (BEST PRACTICE)

David (Preacher) Dodd reports that Senator Mary Landrieu has introduced legislation to increase small business exports. The US administration is appointing a special trade assistant for small business to

• promote the trade interests of small business concerns.
• identify areas of demand in overseas markets.
• identify and address foreign trade barriers that impede exports by small business concerns.

 Small business represents 97% of all exporters in the United States and account for 29 percent of the volume.  The constraints identified by the US Administration are:

• lack of sales volume or resources to overcome the costs of trade barriers and overhead expenses in international transactions.
• Small business advocacy groups often lack political influence in foreign countries, which hinders efforts to solve problems outside the legal process.
• Small business advocates are not as visible or vocal on issues relating to international trade.

 David suggests that the proposed Cockatoo “Sunrise” project (aimed at bringing US and other nations into aid-investment-trade consortia) fits exactly with Obama’s mantra of “community” and “being a better partner in the global community.”

Successful clusters – advice from Belgium via Finland

 As previously flagged in this newsletter, some clusters are humming and others are on life support. Elisabeth Rocha (Belgium), a long-time supporter of TCI (see above), provided timely advice at TCI Finland:

“The secret of a successful cluster is to remain open for changes. Second important thing is good teamwork. The energy shouldn´t be wasted in tangling with the problems inside the company or cluster.

The success lies in being open to outsiders. A good cluster achieves a balance – all people in the region should be benefiting from it, not just the one sector involved in the cluster.

A successful cluster spreads its growth to other sectors. Too often forgotten is the importance of looking far ahead to the future. Many times we focus only on the present, which is a mistake. A cluster turns out bad if there is some company which is thinking only itself and doesn’t add any benefit to others. Usually that kind of company is involved only because of the public funding.”

(Thanks to TCI)

Far North Queensland – relaxation you can’t fake

 

The Cockatoo Team was in Far North Queensland in October. Herewith our report.

 Quality infrastructure – FNQ really is a well-integrated regional economy – there is now a breadth of economic activity beyond tourism, tropical fruit and sugar. Cairns Airport is delivering on the hub potential, with Japanese tourists and Gulf prawns coming in, telecoms equipment and meat pies heading out to Mt. Isa, Cape York and beyond. The roads, rural as well as urban, are generally first-class – although some Cockatoo members say the Cairns-Gordonvale sector is a car park in peak periods. The Cairns Esplanade has become a wonderful great example of infrastructure providing a focal point for a community.

Tourism characteristics – Despite the cheery dispositions, the city of Cairns is struggling. We are reliably informed that the unemployment rate is nudging 14%, due to falling tourism numbers and the NQEA shipbuilding facility losing a defence contract to Victoria. So the locals are talking about inventing new attractions based around adventure tourism. By the way, swimming in FNQ outside of swimming pools is a risky venture – take you pick of sharks, stingers or crocs. But the region’s point of difference is the genuine hospitality, and the undercurrent of relaxation. This cannot be faked, and it extends to all the locals, not just the tourism operators.

 Local produce – Another point of difference – the local produce – is being smothered. Take Port Douglas, 80km north of Cairns. It has a Noosa feel, with an excellent range of accommodation and restaurants. It suffers from a culture of appallingly weak coffee, but you can shrug that off. It has a serious lack of small businesses selling seafood, fruit and vegetables. When Rudd, Bligh and the Chamber of Commerce are crying out for small business growth, where are the policies and incentives for street stalls selling prawns straight off the trawlers, and greengrocers selling paw paws from the farms? Tourists want the unique and mystical experience. You have to shop at Woolworths in Port Douglas for such items – we could have been in downtown Canberra! Crazy state of affairs!

Recycled rubber (BEST PRACTICE?)

On 5 November, Federal and State Ministers announced that a tyre recycling scheme will commence in 2010 – but Ministers backed off a legislated scheme due to pressure from the cement industry (which burns tyres in kilns) and general concerns re Big Brother. Hence there is STILL no agreement on the details.

This week we explained our thinking to the feds (Dept of Environment), following which we’ve been invited to a ‘Tyres Roundtable’ – others involved are Australian Tyre Industry Council, Australian Tyre Recyclers Association, Minerals Council of Australia, Cement Industry Federation, Federal Chamber of Automotive Industries, Motor Trades Association of Australia, Victorian Automobile Chamber of Commerce.

The approach we are pursuing is:

• Big opportunity for councils to attract facilities to manufacture rubber crumb and downstream products e.g. rubber matting; footpaths; underlay for soccer, hockey grounds; road safety barriers.
• Recent improvements in processing technology (UK, Germany) indicate that a viable processing plant can be established with feedstock of one million tyres annually. Long distance haulage of used tyres is not viable, so regions of 1 million plus should be able to sustain a vertically-integrated recycled rubber industry.
• City councils (e.g. in Adelaide, Perth, Sydney, Melbourne, Brisbane) thus have real potential to establish a greenfield processing plant – also regional centres with ‘road transport competitiveness’ should also be attractive e.g. Shepparton, Parkes, Orange, Port Macquarie, Wagga etc. And Newcastle has an opportunity to expand its facility.
• Other councils have potential to be first-movers in the uptake of recycled tyre products – and we have begun discussions re how a grant program might be developed to facilitate this.

 If you would like your council or company to be introduced into these agendas, please contact us ASAP.

 

RDA system a shamozzle, says Silverhawk

I have bitten my tongue, but no more. The new RDA Committees, which replace the 55 Area Consultative Committees, are not going to meet the expectations of regional folk. The reason is that no one in Canberra could really give a damn – and National Party warriors are not saying much because they want Labor to wear the results.

Alarm bells began ringing when the staff running the ACCs were told two years ago to sit on their hands. Then there was the usual review so that regional Australia could develop smarter ways to improve their effectiveness etc. Then the lengthy process began of marrying them with the state RDBs – I said then that this could be wonderful if the feds took it seriously. Then a few more delays as Gary Gray was moved to establish the Office of Northern Australia.

Sadly, the RDA Committees could have had a real influence – by advising how infrastructure expenditure is to be rolled out, by facilitating new regional investments, and by fast-tracking the smaller expenditure to get things moving. But the Department of Finance has cut program funding to pay for the GFC i.e. everyone’s roof insulation, bike trails and school gymnasiums on Sydney’s north shore.

 Mayors should be demanding some long-term sanity to infrastructure spending and regional development. You can’t have 200 ACC staff sitting out there for two years doing nothing, then a flood of funding, then a trickle. Local players need to band together with their state colleagues and appeal to the Prime Minister for a whole-of-government long-term approach with a constant supply of oxygen.

 

Victor Harbor aged care (BEST PRACTICE)

 Silverhawk muses above about how local communities might attract business and government marbles rolling around the landscape.

 Well here is a great example. Victor Harbor – aka known as ‘Victor’ – is a typical seaside town. It is where the pride of South Australia lost its innocence in hot summers long gone. Some have now retired there with a wistful gaze and a rug on their laps. (My in-laws live there!).

 Anyway, Graeme Maxwell et al at Victor Harbor Council explain they have the oldest age cohort in Australia (54.1 years), an excellent hospital (albeit a shortage of GPs), and now a priority rollout of the National Broadband Network. We got talking about the potential of these factors to underpin a health care precinct.

The vision splendid – research associated with an ageing population (Flinders Uni has a rural clinical school there), clinical trials for drugs for elderly patients, design and manufacture of gophers, wheelchairs, rehab devices etc., alternative medicine, web-based businesses, golf courses, walking trails, adventure tourism, knowledge-based outdoor jobs for youths. And a more balanced population age structure.

You don’t need to be prescriptive – the investors will determine the specific business activity. But th locals need to remove impediments and get the right mix of infrastructure to support these businesses.

But my vision doesn’t get much encouragement from the SA Government’s 30-year plan for Greater Adelaide. It makes scarce reference to Victor. I actually rang the folk in the Department of Planning & Local Government to check that Victor (one hour’s drive from Adelaide) is inside the geographic scope of this exercise. When I was assured that the answer was ‘yes’, I respectfully suggested that they could look a bit more closely at Victor. They obviously thought I was being a smart-arse because the line went dead.

But the 30-year plan certainly talks about health and wellbeing, business clusters and growth corridors. Is the SA Government leaving it to the invisible hand of the market to fill in the details? From my experience of tracking how entrepreneurial hot spots emerge, there are usually three success factors.

• A trigger via a new piece of infrastructure that gels with other economic and social infrastructure to establish a locational advantage – the NBN roll-out might be that trigger.
• Local champions to raise awareness and press buttons – to connect to external champions. Coincidentally, the 3 federal Ministers relevant to health care are women (Macklin, Roxon, Gillard) as are the 2 state ministers (Lomax-Smith, Rankine). And 7 of the 10 councilors are also female! 
• A collaborative structure that can connect the dots – the Fleurieu RDB is being formed.

Make ‘em come, make ‘em stay

 We uncovered a gem at a conference in Victoria in July – Pauline Porcaro, a Melbourne-based hospitality and tourism teacher – her passion is to introduce a regional agritourism project into Australia.

The  Gallo Rosso (Red Rooster) accreditation system was developed in northern Italy where agritourism ventures doubled in 5 years as a result.

 The typical set-up is the men running the farm and women the tourism businesses. Operators sell local products e.g. wine to visitors. Among the variations is a teaching farm for city schoolchildren – at a cost of $5-6 per child, operators provided a home-made snack and insights into farming life. Another farm ran an ‘adopt a sheep’ program. “You visit a farm, adopt a sheep and take home a photo of the sheep…you get regular updates and once a year they get a bit of fleece or cheese …”

 It is very exacting for business operators e.g. top ranking requires all soft furnishings to be made of natural fibres; operators are not to give up farming; restrictions on accommodation size. In exchange, there is government support, especially for training and marketing.

 Pauline says we need to define agritourism, and help farmers develop a good strategic plan and decent signposting in every town. Industry has to lobby government, tourism networks must work with farmers, and we need to start to use agritourism as a term. (We couldn’t agree more, and we are going to work together to get some federal/state funding. Contact us if you are interested in being part of an alliance.

Thanks to Pauline Porcaro – www.redrooster.it/en/ or http://agritourismaustralia.com.au/

Anyone for marbles?

 A national economy is a mosaic of integrated regional economies. And they are essentially basins of attraction for private and public sector investments, that in turn drive economic activity and wealth.

Imagine each basin varying in size, with different sized marbles rolling around looking for a home. Large cities attract both business marbles and government marbles. But small towns and distant regions have shallow basins, and any business marbles don’t stick around if things get slippery – they gravitate to larger nearby basins, and the government marbles follow the action.

The business marbles have shrunk in recent times due the GFC winter events, so the government marbles have grown in size and become bolder.

The biggest is the PM marble (gold) that rolls around spreading largesse wherever it can.

The next biggest marble is Treasury/Finance (black), but it doesn’t get out much, and remains nailed to the Canberra basin.

And there are big pink marbles – community services (FAHCSIA), health and education. They are incredibly active, smooching around big and small basins alike, looking to do good things. They have a feminine side because Mesdames Macklin, Roxon and Gillard are in charge. But their progress is slowed by jaffa-sized marbles rolled in their path by things called the states.

The Defence marble is also big, adorned with medals and ribbons. It has a strong masculine side and it rolls where it likes, spilling more than it dispenses.

And the Infrastructure marble is blue because it’s controlled by males infatuated with planes, trucks and trains. This particular marble has been rolling around for over a century, but says it’s close to making things fit, despite many jaffas rolled out by the states.

Then there are four medium-sized industry marbles – innovation, industry, science and research; broadband, communications and the digital economy (BCDE); agriculture, fisheries and forestry; resources, energy and tourism. They are RED because Treasury thinks they are dangerous. The BCDE marble has flashing red lights due to its promised expenditure across all basins.

The two green marbles are climate change-water and environment-heritage-arts. They have a feminine bent, shamelessly rolling around most basins with a mix of carrots and sticks. Jaffas are also in evidence.

Contributed by Silverhawk – article appears in the Good Oil column (LG Focus – October 2009)

The connected university (BEST PRACTICE)

 A new UK report says the UK’s universities are precious national assets. And with the collapse of the UK’s financial services sector, universities are a key to the revival of innovative businesses.

The report highlights the importance of universities as sources of knowledge and skilled employees, as well as centres for regional economic clusters e.g. Cambridge. In the last 15 years, the process of formal knowledge transfer – developing spin-out companies, profiting from patents and licences – has been professionalised. This ‘commercial university’ model has helped promising clusters emerge.

More recently, the ‘connected university model’ has emerged – building clusters, connecting to the national and international economies, bringing together thinking, practice, and finance. Several ways to do this:

• Ensuring tech transfer organisations are performing at the standard set by leading UK institutions.
• Recruiting and developing ‘boundary spanners’ – people who can make the linkages.  
• Better measuring benefits of university-business interaction and communicating them to the public.

 Local government should look at how it applies planning regulations to universities. Physical spaces for business interactions are important. Also a need for a broader dialogue on the role the university in local economic development. 

The connected university (PDF).

Contributed by Professor Roy Green (UTS).