UPFRONT Kiwis can fly

Local exporters are hardy lot – high exchange rates may have clipped their profits and prompted some to curb investment plans but most of them are optimistic about their future prospects for revenue growth.
That’s according to the second DHL Export Barometer – survey developed in conjunction with NZ Trade & Enterprise and representing the only large-scale evaluation of Kiwi exporter confidence. The percentage of respondents expecting an increase in export orders has risen since the first measure in May this year.
Seventy percent now anticipate lift in export orders next year and only three percent believe order levels will ease during the period. For 60 percent, the positive expectation just extends the pattern of reported growth during the previous 12 months.
However, the optimism extends to some markets more strongly than others and there are signs that exporters are consolidating their efforts on fewer markets – only 18 percent say they export to four geographical regions compared to over quarter in the previous survey.
The expected reduction is more apparent in Asian economies such as Japan, Hong Kong and SE Asia. Exporters are most confident of gaining some growth in Australia. Expectations of growth in the UK and US remain unchanged on 65 percent.
Middle East, Eastern Europe, Korea and Latin America are markets exporters are least confident about.
Most popular target market is Australia which is where 66 percent of respondents expect some growth, closely followed by North America and the UK (both 65 percent) and SE Asia (61 percent).
The high Kiwi dollar is inevitably drag factor with 82 percent claiming the exchange rate has knocked their profits and 74 percent reporting that it has impacted on their sales revenue.
Despite this, almost 70 percent of exporters expect their profits to increase over the coming year with the agricultural, tourism and service sectors demonstrating the most optimism.
DHL Express New Zealand general manager Phil Rountree says the results show that New Zealand exporters are continuing to push ahead in highly competitive market domain, and that’s “very pleasing, particularly given the tough trading year”.

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