The SME Stream

Sir Rod Drury believes it's New Zealand's time to step up and make a big difference in the world. 

The Xero founder has been crowned the 2026 Kiwibank New Zealander of the Year. 

The judges noted in the ceremony last night his driving innovation, empowerment of Kiwi tech leaders, and his venture philanthropy. 

He's involved in multiple projects including pushing for expansion of renewable power and electrified transport. 

Drury told Mike Hosking the world is scary, and Kiwis need to stick together and use our values to contribute to the world. 

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Why do some places become tech powerhouses while others, just as smart and connected, stall out? 

In the latest episode of The Business of Tech, global innovation expert Mehran Gul, a former policy expert at the World Economic Forum, and the United Nations, dispels the myths about where breakthrough technology happens – and gives his take on what New Zealand should do to improve its innovation game.

Gul’s new book, The New Geography of Innovation: The Global Contest for Breakthrough Technologies, comes to a simple conclusion - there’s no fixed map of innovation. 

Silicon Valley, with its concentration of startups, tech talent and venture capital, remains an innovation powerhouse. But China went from being dismissed as a copycat to a genuine tech superpower in five to seven years. 

Canada, via one small lab at the University of Toronto, helped trigger the entire modern AI boom with AlexNet and a handful of researchers who went on to shape OpenAI and the wider industry. If they can bend the curve that fast, so can so-called “middle powers” and smaller countries like New Zealand – if they stop telling themselves they’re too small, too distant, or too late.

Tech makers, not tech takers

Gul explains how the ingredients of innovation look radically different from place to place. Silicon Valley has anchor universities, thick venture capital markets and a constant deal engine of big firms buying smaller ones. 

In China, the giant tech platforms came first, then research labs and world‑leading developments like ResNet, a neural network architecture. Singapore doesn’t have household‑name tech brands, yet it dominates venture capital in Southeast Asia.

Gul’s assessment of New Zealand is that the likes of Rocket Lab have demonstrated our ability to produce successful, innovative companies. It’s that we keep losing them, talent and listings included, to the United States and other major markets. He argues the real test is whether a country can hang on to its winners, build a startup “factory” around breakout successes, and use policy to push founders towards IPOs and broad employee ownership instead of early exits to US tech giants.

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The Government is looking into ‘doing something simple’ to get cash into Kiwis' wallets as fuel prices increase, refined oil proving a challenge. 

Finance Minister Nicola Willis told Mike Hosking they need to balance the cost of living with the books. 

“We need to be conscious of debt and borrowing. 

“We need to look at working people in the low to middle income specifically and ask ‘what’s the way we could provide targeted relief’ without a blanket solution.” 

Willis said cutting wider costs like fuel excise tax could drive inflation up. 

“We are looking at doing something simple to get cash into bank accounts on time. Cash provides people flexibility.” 

She said her desire is for no paperwork to be involved. 

“I’m sorting advice from Treasury and IRD as we speak but I have a plan in front of me ready to go.” 

Willis said the challenge now is getting refined oil, with government in conversation with fuel suppliers. 

“We have shipment locked in for several weeks, but we are looking ahead to future challenges of how to actually source diesel, jet fuel and other things out of refineries. 

“This could create a limitation in the future.”   

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New Zealand's economy wasn't doing as well as we thought, even before war broke out in the Middle East. 

Latest Stats NZ data shows GDP rose just 0.2% in the December quarter – well under the Reserve Bank forecast of 0.5%. 

Inflation hit 3.1% in the quarter, above the central Bank's forecast of 2.7%. 

The Herald's Liam Dann told John MacDonald if the Iran conflict continues, we could be at risk of "stagflation" – a combination of high inflation and low growth seen in the 1970s. 

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New Zealand's economy is heading into the current Middle East crisis noticeably weaker than expected.

GDP's risen just 0.2 percent in the December quarter - well below many forecasts.

It's also risen just 0.2 percent across the whole of last year, after growth in the September quarter was revised down.

ANZ Senior Economist Matt Gault tells Ryan how the Reserve Bank will react to this news. 

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Former Reserve Bank economist Michael Reddell says it's getting harder to know how much the economy's growing or shrinking.

Stats NZ estimates GDP rose 0.2 percent in the December quarter, below most forecasts.

But Reddell says it's also revised the figures for previous quarters.

He says the 0.2 for December could still potentially be revised up as high as 0.5 percent, or as low as minus 0.1.

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I’m sorry to say it’s a bit of a bad day - a day of rather unpleasant economic news, I’m afraid.

Let’s start with the GDP number. It came in at 0.2 percent for the final quarter of last year, which is very much at the low end of expectations. We were looking for something in the range of 0.2 percent to 0.5 percent, with 0.5 percent being the Reserve Bank’s forecast.

The problem with that is those were the good times. That number was recorded before the Iran war kicked off, so it’s not much of a place to be starting from, is it?

Now the good news is that at least we are recovering. Yes, it’s slow - it’s grinding - which we always knew it would be but it is real. We recorded 1.3 percent growth for the year. That’s not a lot, but it is growth and it marks the first time in more than two years that the economy has posted annual growth.

Because the GDP result is at the low end, it also gives the Reserve Bank a bit more latitude when it comes to its OCR decision. It can look through the inflation spike that the Iran war will almost certainly cause, which means it doesn’t need to be in such a hurry to raise the Official Cash Rate in response.

The second piece of bad news today is that the war has escalated. Israel has struck Iran’s oil fields, pushing the price of oil past US$110 a barrel.

It’s noticeable that the Government’s tone has shifted on fuel supply. In an update, officials sounded far less relaxed about fuel availability into the medium term - around eight weeks out - than they did earlier in the week.

There is, again, a small piece of good news here. We are largely reliant on South Korea and Singapore for our oil and they are still supplying their customers. Australia, by contrast, is much more reliant on China - and China has banned exports.

So, if we’re looking for a bright side: our supply situation looks better than some and at least we are growing. That gives us some reason not to panic on a day of not-so-great economic news.

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In Leaders Getting Coffee episode 58, our guest Sharon Zollner, Chief Economist at ANZ Bank.

At a time when the economic recovery in New Zealand is threatened, yet again, by a major international shock, we thought it was worthwhile to host one of the Country’s leading economists on Leaders Getting Coffee. And we weren’t disappointed. This week’s guest is one of the most entertaining economists we could wish to speak to.

A self-confessed geeky kid, and cricket tragic, Sharon Zollner grew up in rural Canterbury in a farming family near Methven. She excelled at school, particularly it seems in English and Mathematics, capabilities which influenced her decision to study English Literature and Economics.

She left Canterbury University with a Masters in Commerce and majors in Economics and English Literature, and headed to the New Zealand Reserve Bank to start what has become an amazingly successful career.

A stint with Norway’s central bank followed, where her work included developing a macro economic model for the Norwegian economy.

Returning to New Zealand, her climb up the ranks of Bank Economists has been rapid and she speaks openly about becoming the Chief Economist at ANZ in 2017, just ahead of a change in government and prior to the disruption created by Covid 19.

On the Leaders Getting Coffee podcast Sharon Zollner speaks to Bruce Cotterill about the current state of the New Zealand economy, which she suggests is more resilient that many of us might expect.

She is also refreshingly open about the impacts of war in the Middle East and the associated panic around oil prices and supplies, and the likely stages that economies will go through as the conflict continues.

As you might expect, Zollner reels off economic terms and statistics in an uncomplicated manner that is easy to understand and entertaining to listen to. Her lessons from Norway are interesting given the similarity of that economy to that of New Zealand, and the differing constraints that the two countries must operate within.

Most importantly, she is positive about the current state of New Zealand, despite the obvious headwinds, and one wishes that her enthusiasm for our future should be contagious.

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Jarden analyst reviews last night’s GDT auction, up 0.1%, the sixth consecutive rise. While the result remained basically unchanged, “unders and overs” were all over the place. Whole milk powder down 4%, skim milk powder up 5.2%, anhydrous milk fat up 6.4%, butter down 0.9%, and cheddar up 0.1%. 

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Officials are calling out the Government for loosening KiwiSaver withdrawal rules in response to lobbying by Federated Farmers, rather than evidence-based advice.

A newly-released Regulatory Impact Statement shows the Ministry of Business, Innovation and Employment (MBIE) opposed the Government’s proposal to allow KiwiSaver withdrawals for farmland. 

NZ Herald Wellington business editor Jenee Tibshraeny explained further.

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