The idea of Wellington winning New Zealand’s ‘Top Town’ status would have been laughable 10 years ago, says Wellington Chamber of Commerce president Barrie Saunders. But the city with the bleak and breezy reputation has been reinvented and re-invigorated and Saunders can now see why it won the accolade. “And success feeds on itself,” he says.
British-born Ray Thompson, founder of locally-based film company Cloud Nine, agrees. Thompson came to Wellington in the mid-’60s to make children’s TV series. He found all the photogenic locations he needed within 30 kilometre radius so he based his company in Lower Hutt and stayed. Now he’s “a great fan of Wellington”. “It’s an ideal place to do business and great place to live and it’s got great future,” says Thompson.
Persuasion Advertising’s Eugene Doyle is equally enthusiastic: “It’s an absolutely fabulous place to work, to live and to visit.” Mind you, he would say that. It’s Doyle’s job to attract tourists to the city.
His clients include the Hurricanes Super 12 rugby franchise and the Lions NPC team. His company also runs the ‘send-yourself-to-Wellington’ campaign, $1.2 million marketing push designed to promote the city as weekend tourism destination and run by Totally Wellington, trust of public and private organisations funded from levy on the central district.
Doyle believes the campaign contributed to North & South magazine’s decision last year to nominate Wellington as its “Top Town”. Whether it did or not, the campaign is “certainly an economic driver” for the city, he says.
Hotel occupancies, retail sales, foot traffic counts and Air New Zealand sales all show the campaign has had big impact. The weekend business it generates is boon for local hotels; “previously, weekend visitors would rattle down empty corridors”, says Doyle.
The extraordinary popularity of Te Papa, the national museum, has also played significant role in lifting the number of visitors to the city. But, says Infometrics economist Tony Booth, so have attractions like the Festival of the Arts and the major sports fixtures that regularly feature at the “cake tin”, as the WestpacTrust Stadium is popularly known.
Tower Corporation chief executive James Boonzaier is little more equivocal about Wellington’s business strengths. He agrees that it has lifestyle, fine restaurants, dollops of culture and geo-graphy going for it but it still suffers from the fact that it is not New Zealand’s largest city.
The proximity to politicians and diplomats from host of nations is frequently convenient but Auckland is the biggest domestic market which gives Auckland companies an advantage.
Wellington may be just an hour by plane from Auckland and even less travel time to the South Island but an international air service hub it is not. These drawbacks aside Boonzaier still believes the company has great deal to offer both local and global businesses operating in the New Zealand market.
Despite the size-driven drawbacks confronting the city and the trend by larger enterprises to relocate head offices to north of the Bombay Hills, Saunders is adamant that Wellington is “top town” for business.
New businesses are arriving he says and he ranks the city’s advantages as:
* Its geographically central location.
* Being the capital city.
* Having good economic infrastructure including good port company, rail service and airport.
* Being “extraordinarily liveable”.
Saunders ranks “liveability” at the top of his list. Wellington is New Zealand’s most sophisticated city. That, among other things, makes it good environment for head offices and businesses, particularly in the services sector, he says. “It’s easy to move about the city, it’s easy to operate in it, and its geography gives it compactness which makes it stimulating environment.”
Saunders believes Wellington is ideal for the burgeoning global services sector. Successful service enterprises, such as software companies, are made for Wellington. “You can have customers all around the world, if you are good in the services sector,” says Saunders.
Wellington has already developed significant film industry and is acknowledged as strong in creative industries and the “intelligent” industries based on software and new information technologies.
The universities, Victoria and Massey Wellington, plus the Wellington Institute of Technology and polytechnic in Porirua and crown research institutes, are all promoting their creative capabilities and attempting to establish specialist industry hubs. “Our academic facilities have an enormous relevance to the city’s development,” says Saunders. Or rather, he corrected himself, “they have enormous potential”. He believes they could deliver Wellington some real competitive advantage. But the linkages between the tertiary institutes, CRIs and business must be more effectively developed.
Tony Booth agrees that business services probably offer Wellington its greatest growth potential, though the creative industries and tourism will also be significant. The head offices that once headquartered in the capital have made way for film and multimedia companies, and Infometrics employment data show the software industry is more intense in Wellington than other centres.
The Wellington economy is much less exposed to the export sector, apart from tourism that is, than most other New Zealand cities. This is both strength and weakness. During an export downturn, such as the one promoted by the late ’90s Asian crisis, the Wellington economy felt the impact less acutely than other regions. But when the export sector booms, as in recent months, Wellington’s retort is muffled.
In the year to March, New Zealand’s service sector grew faster in real GDP terms, than any other. This means business volumes were increasing and theoretically this should create employment, which is why Wellington’s economy is ticking over at reasonable pace.
The long period when Wellington’s economy seemed to defy gravity is over. In the late 1990s dip in employment hardly seemed to dent spending, house prices or building activity. These activities have slowed over the past 12 to 18 months.
Growth in the service sector nationally theoretically augurs well for service-intensive Wellington, but Booth points out that some of that service growth might be occurring in places like Auckland, which is closer to Waikato where dairy industry profits are generated.
The most up-to-date economic report for the Wellington Regional Council was published in February. Its data show that in the year to March 2000, the Wellington region contributed $13.3 billion to national gross domestic product of $103.7 billion. The national population at June 2000 was 3,831,000; 429,700 of these people lived in the Wellington region. The number of businesses nationally was 313,461; Wellington accounted for 38,556 of them.
David Kiddey, at Invest Wellington, is charged with boosting those numbers by promoting Wellington’s business environment to investors. Using his website, promotions and New Zealand’s overseas trade posts Kiddey has specifically targeted sectors such as film production, IP companies and call centres.
Access Technology for instance, Japanese recruitment company, found it more economical to base its call centre in Wellington than in Tokyo. The business started with five operators. Today there are 30. Mobil based its Australasian call centre and its IT processing and ordering operations in Wellington. Startel, an Auckland company, is another call centre recently attracted to the city.
Invest Wellington is restructuring and is about to be incorporated within Wellington regional organisation. The objective is to rationalise the business-investment promotion operations of the Wellington, Hutt and Porirua city councils which had, to some extent, been competing with each other, and encourage businesses to base themselves in the greater Wellington region.
Kiddey rates Wellington’s competitive telecom
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