A new report by the NZUS Council has affirmed the importance of the United States as a high-value market for the export of digital services for Aotearoa New Zealand’s IT industry.
While the primary industries sector is still streets ahead, with wine alone accounting for $625 million in 2020, the digital services market growth has seen become a major contributor.
“The United States is New Zealand’s third largest trading partner overall and it is now our largest destination for services – receiving over 22 percent of our total service exports,” said Trade and Export Growth Minister Damien O’Connor.
In general, NZ’s exports of computer-related services have doubled over the past four years and now account for around 25 percent of services exports to the US, according to the report.
“Digital services are a major contributor, with $682 million worth of exports to the US spread across computer services and software license exports. US trade and investment has also played a key role in the development of the New Zealand space industry,” O’Connor added.
Specialised high-tech manufacturing is also playing a major role in technology exports, as shown by the following graph taken from the report (pdf), which highlights in red the non-primary sector exports.
To exemplify this, sleep apnoea machines accounted for $260 million worth of exports in 2020, a larger share than either timber or casein.
“Trade is vital to our economic recovery from COVID-19 and we will continue to support New Zealand companies doing business with the United States when the Prime Minister travels there, amongst other countries, on her trade mission later this year to further accelerate that recovery,” O’Connor added.
The report, titled The NZ-US trade relationship: Stability and diversity in a time of change, calls out several Kiwi tech success stories including accounting software giant Xero, digital human developer Soul Machines, advanced air mobility (flying car) company Wisk, and breast cancer risk assessment software developer Volpara.
The report follows recent findings out of Stats NZ that sales of software and services by NZ’s ICT sector rose reached $13 billion in 2021, up 39 percent from 2019, with exports up 27 percent over the same period to $2.2 billion.