Inbox: Glass half full or empty – Exporters divided

While New Zealand exporters have been finding it tough, with confidence at an all time low, just over half are still cautiously optimistic about the next 12 months according to the 2012 DHL Export Barometer.
The annual survey of New Zealand exporters found that only 51 percent of exporters are confident about an increase in export orders in the next 12 months significantly lower than 2011 when 70 percent of exporters were expecting growth, and the lowest in the history of the DHL Export Barometer, which has been running since 2004.
“There’s no denying business conditions for exporters have been challenging,” says Tim Baxter, DHL Express’ New Zealand manager. “While the survey result is lower than previous years and indicates difficult trading conditions in the first part of the year, there’s still some optimism going forward.”
Exporters in agriculture have been leading other sectors with 60 percent experiencing an increase in orders over the past 12 months and are expected to continue to lead over the next 12 months with services and manufacturing exporters closely following.
“We’ve been fortunate to have exports of agricultural products remain strong through an uncertain period. But farmers are less optimistic going forward so it’s promising to see the service and manufacturing sectors looking more confident than they were 12months ago,” says Baxter.
According to the survey, the two most negative factors impacting exporters’ business sales in the last 12 months have been exchange rates (58 percent) and rising fuel costs (46 percent). Other factors cited as negatively impacting sales were economic/political conditions abroad, the cost of raw materials and international competition.
“There are numerous factors contributing to difficult exporting conditions,” says Baxter. “In complex economic environment such as the one we’re in now, there’s not going to be single fix to make it better.”
Australia continues to be the top current export destination, followed by North America, Europe, China and UK. The majority of exporters (59%) expect orders to China to increase in the next 12 months.
“There will only be one transition as big as China in our lifetime,” Baxter contends. “With four billion people and 60 percent of the world’s population, we are seeing meteoric trade shift. This is borne out in the survey results that show that Asia, led by China, is where the growth opportunities lie. Economic trading barriers are being reduced in Asia and New Zealand exporters need to take advantage of this.” M