Role for Government

While the bulk of the work going forward is the responsibility of the firms and individuals that make up the primary sector, there is a role for government in promoting continued primary sector growth:

The government can help by doing what is good for business generally...

1. Factors that are good for business generally will be good for the primary sector. The government should:[15]
   • Maintain the country’s strong institutions and stable macroeconomic environment;
   • Clearly define and defend property rights, to provide an encouraging climate and clarity for business investment decisions;
   • Minimise regulatory constraints on business (reducing compliance costs and “red tape”);
   • Encourage the acquisition and maintenance of skills and flexibility in the labour market to drive labour productivity improvements;
   • Maintain a competitive open economy that exposes our primary sector producers to world price signals and international competition;
   • Continue to support research and development that aligns with New Zealand’s areas of comparative advantage;
   • Ensure that resource allocation mechanisms work efficiently, attribute the full costs of activities, and provide for sustainable use of the country’s scarce resources; and
   • Ensure adequate investment in infrastructure, including roading, communications and energy;
2. The ongoing provision of a robust national biosecurity regime, as outlined in the Biosecurity Strategy, will become increasingly important as our international linkages grow;

... managing biosecurity risks and pressing for international trade liberalisation…

3. The government should continue to press for improved international market access, both through bilateral negotiations and through multilateral mechanisms such as the World Trade Organisation and the Doha round. The potential gains for New Zealand from international trade liberalisation are large, but so is the task of securing those gains; and
4. Environmental challenges need to be managed strategically. An increasing focus on environmental quality will alter the way that the environment is used as an input to production going forward. The government can provide frameworks for weighing up competing demands and impacts, and incentives for market players to find innovative solutions. Particular areas of interest in the short-to-medium term will include:

...and helping to manage environmental challenges strategically.

• Establishing a framework for considering competing demands for water use, whether that be irrigation, recreation, or cultural values;
• Providing incentives to encourage innovative ways to reduce greenhouse gas emissions to meet the country’s climate change commitments; and
• Investigating the trade-offs made in decisions around mining activities, and whether sufficient weight is being given to the potential benefits to the economy of increased mining production.