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Challenge
The purpose of this analysis is to brief the Minister of Finance on what we believe are the
strengths, specialities and opportunities in the Canterbury region and outline policy
recommendations to further develop them, therefore contributing to higher living standards.
Tourism
Tourism has always been a significant contributor to the Canterbury economy. While the
earthquakes have had a negative impact on tourist numbers we see huge potential for
tourism growth over the next decade. One area of potential is in the cruise ship market.
Currently most tourists arrive by air and enter the country through a modern airport in
Christchurch with a range of shops, restaurants and bars which create a welcoming
atmosphere. International visitors then travel through entrance of the garden city.
Alternatively, the few that arrive on cruise ships enter through an industrial port which is not
a particularly attractive part of the city, and are therefore less inclined to stay longer than
they have to. Consequently, we think the central government should invest significantly in
improving this gateway to the city. This would then lead tourists to stay longer in
Christchurch, spend more, have a much better experience and visit more local attractions as
well as the wider Canterbury region (reference one). If cruise ship visits were more regular
and for longer periods of time, the economic benefits would include increased employment
through more business opportunities and encourage private investment. Complementing this
growth in cruise ship visits we would also like to see more government investment to further
develop cycle ways throughout Canterbury to showcase our iconic scenery. Cycling is an
area that has become hugely popular with tourists and as technology is developing (such as
electric bikes), this could be an area that could experience significant growth. Having
Christchurch as a hub for cycling tourists, allows them to choose from such diverse scenery
such as the Southern Alps, Kaikoura coastline, Canterbury high country and Banks
Peninsula. With tourists becoming more health and environmentally conscious, this is the
perfect complement to go with New Zealand's clean, green image.
We believe that the government should provide the initial investment to get these projects
established. The government will derive significant revenue through indirect and direct
taxation receipts. The returns for this project will exceed the initial investment.
These policies will positively affect Economic Growth, Social Cohesion and Sustainability for
the future, as referred to in Treasury’s ‘Living Standards Framework’.
Reference 1: Cruise passenger numbers growth to Lyttelton Harbour
Human resources
A second area where we see potential and opportunity is the development of Canterbury’s
human resources. The Christchurch rebuild attracted a diverse range of skilled migrants
from overseas. While the rebuild will only last another couple of years, we want to provide
the incentive for these workers to remain in Canterbury and contribute their cultures and
skills to our workforce. A larger Christchurch population means more production, more
income and more growth for recreational and other services. Christchurch has well
established ICT engineering, transport, agriculture and surveying sectors. A policy
recommendation we suggest to develop this opportunity is for central government to fund or
subsidise training opportunities for immigrants that remain in New Zealand and contribute to
our economy.
Canterbury can become a multicultural, cosmopolitan region recognized nationally for its
varied and highly skilled human resources. This will attract increased consumption spending
and economic activity in the region. Greater incomes result in increased direct taxation to the
central government and increased consumer spending contributes to indirect taxation
revenue. This creates promising sustainable economic growth in Canterbury for future
generations.
The most significant sectors which can be developed in the region are ICT, due to the huge
demand and use by many workplaces and tourism, as outlined earlier. Engineering and
construction are the sectors with the greatest vacancy for skilled workers in Canterbury, this
can be seen in reference three. These skills can contribute to building and designing the
Lyttelton harbour to further increase tourism in Canterbury. If tourists are attracted to our
cosmopolitan, unique and multicultural region, then they are also likely to contribute to New
Zealand’s wider economy by travelling to other regions in the South Island and stimulating
their local economy.
A policy to develop this opportunity in Canterbury is for central government to subsidise
specialist training and education for vacant skilled jobs (refer to figure one).
Although this again requires an initial cost to central government and in its infancy doesn’t
benefit all New Zealand regions, the trade off is increased employment and the production of
goods and services and therefore contributing to economic growth. In the long term, other
regions could also benefit from Canterbury becoming an education and skills hub, improving
social cohesion and equity in New Zealand.
Reference 2
Reference 3
Water Utilisation
Water is a plentiful and sustainable resource in Canterbury but a major problem is that water
is not always available at the right time for irrigation. A large proportion of rainfall occurs in
winter and early spring when demand for it is relatively low. With increasing temperatures
(figure 2.1) and having less rainfall in Canterbury than the rest of the country (reference 5),
the time Canterbury spends in moisture deficit has doubled since 1990 and this is causing
an increase in demand for irrigation water. The Canterbury plains has four large rivers
flowing through it; the Rakaia, Rangitata, Hurunui and Waimakariri and these rivers often
flood. The headwaters of these rivers in the Southern Alps mean they catch the north west
rainfall most of which currently floods out to sea.
We propose that the central government subsidises the construction of leak proof,
multipurpose storage ponds that are filled when these rivers are in flood and utilise the best
technology available to minimise losses of water through the ground and through
evaporation. These ponds will provide irrigation water for the drier months for more
economically sustainable farming practises. To illustrate the potential benefit, if the Rakaia
is in flood and 100 cubic metres of water per second was channelled off the river for a 24hour period, this would provide enough irrigation water to irrigate 172,800 ha with 5mm of
water for 1 day.
With water being the single most important resource for all types of farming, a sustainable
irrigation scheme like this could have the long term potential to double the production which
has obvious benefits for economic growth, employment and investment. Taking excess
water when the rivers are in flood and storing it in large storage ponds for irrigation when it is
required is the obvious solution. These ponds and canals can be multi purpose and create
numerous positive externalities creating opportunities for other services. such as a training
destination for rowers, recreational and/or competitive water sports, fishing, and the
possibility for power generation etc. There are no negative impacts on the environment when
taking the excess flood water from rivers as rivers are not being drained below their natural
flow rate. The fact that water can be taken and stored when irrigation water is not required
means that the rivers are able to maintain their minimum flows.
An obvious positive impact will be the employment opportunities that the initial development
will provide. Once irrigated, the land will be more intensively farmed resulting in more
efficient production and a further increase in demand for employment in the region. While
this initiative creates a short term fiscal cost for central government, the trade off is long term
sustainable economic growth and further taxation revenue for the government. This initiative
creates a short term fiscal cost for central government, the trade off is long term sustainable
economic growth and further taxation revenue for the government.
Reference 4
Reference 5
We have outlined what we believe are three clear strengths and opportunities of the
Canterbury region. Our recommended policies will enhance the living standards of all New
Zealanders by maintaining sustainability for the future, improving equity, strengthening social
infrastructure and increasing long term sustainable economic growth.
Sources
http://www.christchurchnz.com/media/918364/tourism-sector-case-for-lyttelton-cruise-wharfdevelopment.pdf
http://sciblogs.co.nz/waiology/2011/06/17/rain-mainly-in-the-plains-not-so-much/
http://ecan.govt.nz/publications/Plans/cw-canterbury-water-wanagement-strategy-05-1109.pdf
http://www.mfe.govt.nz/climate-change/how-climate-change-affects-nz/how-might-climatechange-affect-my-region/canterbury
https://www.mpi.govt.nz/protection-and-response/responding/adverse-events/classifyingadverse-events-/dealing-with-drought-conditions/