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ECAT 2002 Sector Forum

Hon Paul Swain Speech Notes

Good afternoon. I’d like to begin by welcoming you to the E-Commerce Action Team’s 1st birthday. I have three objectives for the forum today. Firstly, to let you know what the government has been doing since the E-Commerce Summit in November 2000. Secondly, to let you know about some of the e-commerce initiatives that have been happening outside of government. And thirdly, to issue a challenge to you all here today to drive e-commerce through your organisations.

It is now eighteen months (or 6 quarters) since the government's successful E-commerce Summit was held in Auckland and the E-commerce Strategy was released.

The Government's vision announced at the summit was that New Zealand would be `world class in embracing e-commerce for competitive advantage'.

Summit participants delivered a strong message - with the strategy the government had made a good start, but we had to do more and faster.

One significant outcome of the Summit was the setting up of the E-commerce Action Team (ECAT) in March 2001. Designed as a partnership
between Government and business, ECAT was tasked with promoting e-commerce by working to improve the understanding of e-commerce and increase its use by New Zealand businesses.

I am pleased with the way that ECAT has gone about it's task over the past 14 months. Early on each sector member of ECAT devised a 6-quarter-action plan and these are currently being implemented.

Of equal importance the ECAT team has been working to spread the `e-commerce message' to audiences around New Zealand, including small businesses, community groups and rural communities. In addition projects such as the new nzecommerce.co.nz website are now coming to fruition.

Alongside ECAT, other organisations have been working to drive uptake of e-commerce. Fonterra is working at improving networks in rural areas to better serve its rural community. The Institute of Chartered Accountants (ICANZ) are actively working on XBRL – a common language to help companies seamlessly swap data between different systems. This has potentially huge benefits in terms of reducing compliance costs. In the private sector Weta are a great example of a kiwi company that has used the latest technology to become a world leader in its field.

Historically New Zealand has been a world leader in take up and use of the Internet. For years, New Zealand has ranked in the 'top ten' of most international measures of Internet use. OECD figures show New Zealand expends the highest percentage of GDP on telecommunications services (4.8%). On a per capita basis we are very heavy users of telecommunications services generally.

According to surveys conducted by AC Nielsen over the past year, more than 70% of New Zealanders have access to the Internet from home or the workplace and about 54% use it on a regular basis. Usage is particularly high amongst young people, with more than 80% of 10 to 19 year olds having access from any location.

Business use of the Internet is growing rapidly. NZ now has the fourth highest number of e-commerce-ready secure Web servers per head of population in the world. A just-completed survey conducted on behalf of MED shows continued strong growth in the use of e-commerce by New Zealand businesses. 74% of businesses with more than five full time employees now have their own domain name, compared with under 50% in a similar survey carried out in 2000 prior to the E-commerce Summit. I am pleased to note that 56% of such businesses now have their own Web site. Professor Shirley Leitch will be commenting on these results in more detail in the next presentation.

While it is the private sector that will largely drive e-commerce uptake, government has an important role to play. The strategy sets out three major roles for government.
- Being a model user, through e-government.
- Helping to build e-commerce capability throughout the country
- And creating an enabling regulatory environment that will foster the fast development of e-commerce in New Zealand.

As a model user of e-commerce this government has set itself a target of making the internet the dominant means of enabling ready access to government, information, services and processes by 2004.

With our E-Government project we have already made considerable progress achieving that goal. We are in the midst of a project to develop a Secure Electronic Environment (SEE) for exchange of government email and access to government information for public servants. Essentially this will be an extranet for government agencies.

The new all-of-government web portal is on track to be launched at the beginning of July. It will be world leading, especially in terms of its architecture which relies upon all government agencies creating metadata using the government’s approved standard. This not only means that government information and services will be a lot easier to find, but also that agencies will be cataloguing a lot of their information using an all-of government standard for the first time.

The e-procurement project is making good progress, with the State Services Commission and Cap Gemini Ernst & Young having recently signed a contract for supply of an e-procurement solution for government. The SSC is now working with agencies as they develop their business cases for using that system.

Inland Revenue is currently working on initiatives to enable businesses to be able to access more information, calculate tax and file returns online.

Building e-commerce capability is essential. This job is being driven by the E-Commerce Action Team (ECAT). Vital to the success of ECAT is its web site, where members of the ECAT network can share resources and experience and keep up with what is happening around the country. An upgraded version of that web site will be launched later today.

While e-commerce is important to the whole economy it is of even more importance to isolated rural areas. To make sure all New Zealanders are kept in the loop ECAT has held a number of regional events in Waikato, Taranaki, Hawkes Bay, Manawatu, Wairarapa, West Coast and Southland. More than 1,600 people have attended these regional events. I have been privileged to attend all seven of these regional events. They have all showcased ordinary New Zealanders doing extraordinary things using e-commerce platforms.

As part of Industry NZ’s Biz Info courses we are also currently offering introductory e-commerce courses for businesses.

This government is serious about laying the correct foundations for e-commerce and is determined to do its utmost to improve the legislative environment. In 1999 we embarked upon reforming regulation of the country’s telecommunications sector, an area long neglected by the previous government. Late last year that work came to fruition with the Telecommunications Act, designed to increase competition and encourage investment in the telecommunications sector, which is the foundation for the knowledge economy.

The Electronic Transactions Bill has recently had its second reading in parliament. When passed, this bill will give electronic transactions the same legal status as non-electronic ones.

Anti-hacking legislation is waiting to be passed and the government is involved in a major reform of New Zealand’s intellectual property regime.

To fully participate in the e-commerce revolution all New Zealanders need access to 21st century telecommunications services – that means broadband. The government has set a target that by the end of 2003 every New Zealand community will have access to broadband.
To ascertain the demand for broadband services in rural areas the government spent $150,000 on two regional economic studies in Northland and Southland. Those studies, completed mid-last year, showed there was a huge demand for broadband in the regions.

In response to that we have funded five broadband pilot projects in the Far North, Taranaki, Gisborne East Coast, Wairarapa and Southland. A major component of these projects is working to aggregate local demand and offering this demand by way of a competitive tender process to telecommunications companies to provide broadband services.

It is envisaged that different solutions and combinations of solutions – involving the telcos as well as players such as BCL, Transpower, local power trusts and satellite providers will be used in different areas.

Look out for some announcements on broadband in the budget next week.

Another key plank in the government’s e-commerce drive is the recently-announced Information and Communications Technology (ICT) taskforce. This is one of three taskforces – the others are in biotech and the creative industries – foreshadowed by the Prime Minister in February as part of the Government’s innovation framework.

The goal of the taskforce is to harness the experience and skills of the private sector to generate ideas and strategies about how best to assist emerging kiwi companies to take on the world.

The ICT sector generates more than $1 billion in exports for New Zealand. As well as being a very significant sector, ICT is an important enabler across other industries, helping to drive efficiencies and enabling companies to get the edge over their international competitors. The taskforce will be reporting at the end of July.

In closing I would like to issue a challenge to all of you here today to think about ways in which e-commerce can both create efficiencies in your organisation and open up new opportunities. Without a determined sponsor at management level an e-commerce project may not get off the ground. I challenge you to drive e-commerce through your business.

If you haven’t done so already, formulating an e-commerce strategy for your organisation is the first step. Become a member of the ECAT network and put your details on the ECAT web site. It’s a great forum for sharing experience and solutions. Thank you for your attention. I look forward to working with you on this important project for New Zealand.


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