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Xero’s plan to the government for a $7.8 billion opportunity

In the annual IMD World Digital Competitiveness Rankings, a reference point for a country’s digitalisation, New Zealand fell by eight rankings in 2022.

New Zealand ranked 27th out of 63 in 2022 whereas in 2018, the country was ranked 19th.

To improve New Zealand’s ranking in the competitive list of digitalisation, the global small business platform Xero has come up with a research plan that will be introduced to the government.

Country Manager of Xero, Bridget Snelling, says there is so much potential in New Zealand becoming more digital.

In a recent research from NZIER, a 20 percent increase in the number of businesses adopting cloud based business tools could add $7.8 billion to Aotearoa’s annual GDP through improved productivity.

“We know digitalisation is a key factor for improving productivity, giving businesses the tools they need to thrive in the modern era,” says Snelling.

“While Covid expedited digitalisation rates as Kiwi small businesses swiftly figured out how to run our businesses remotely, there are still phenomenal opportunities for us to take this adoption further. Aotearoa can become a world-leading digital nation and add billions to the economy.”

Read more: Kiwis with digital skills contribute $7.3 billion to NZ’s GDP

The research looks at the top digital countries in the world such as Denmark and Singapore to help provide guidance to the New Zealand government.

“Economies around the world are rapidly digitalising and businesses in Aotearoa need to recognise the risk being left behind. The Government needs to do everything it can to support our digital progress. In an election year, this should be a priority for all parties,” says Snelling.

Xero and NZIER are reporting that the New Zealand Government needs to focus on certain areas such as:

  • Developing a New Zealand Productivity Solutions Grant and foundation plan to set out a roadmap for successful digitalisation within a range of industries.
  • Establishing a Chief Technology Officer to allow businesses to identify needs, solutions and engage with digital consultants for industry advice and guides.
  • Establishing a digital public service system to enhance productivity and trust.
  • Investing in digital literacy at all levels of society.
  • Promote and subsidise the acquisition of digital skills as part of continuous learning in the workforce and education.
  • Review the level of investment and regulatory frameworks of government research and development of digital technology.
  • Improve the competitiveness of the tech sector’s immigration policy.
  • Continue to invest in digital and urban infrastructure while also improving the efficiency of local and central government to enhance the productivity and attractiveness of cities for digital business leaders.

“When it comes to digitalisation, we know there are several key barriers for business owners including cost and time investment,” says Snelling.

“After all, it can be daunting to commit to overhauling all your processes without knowing what the outcome will be. However, the Government can create policy and encourage digitalisation investment to improve our local economy by billions.”

Through this plan, Snelling believes it will take as little as two years to “rejuvenate” and add billions to the economy.

“We need policies that encourage the expansion of Aotearoa New Zealand’s digital economy by addressing the key barriers many business owners face including financial constraints, skills gaps, attitudes and awareness.”

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