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NZTE International Growth Fund changes following evaluation

NZTE International Growth Fund changes following evaluation

Economic Development Minister Steven Joyce and Trade Minister Tim Groser today announced changes designed to strengthen government investment in developing New Zealand’s export sector via the International Growth Fund.

The Fund invests up to $30 million annually as part of a package of targeted and tailored services from New Zealand Trade and Enterprise (NZTE) that help exporters accelerate growth in international markets.

“Since the International Growth Fund was established in 2009, the Government has approved 50/50 co-funding grants totalling $127.3 million for 336 targeted projects, in partnership with 282 businesses,” Mr Joyce says.

A recent evaluation of the Fund by the Ministry of Business Innovation and Employment found that it was having a positive impact at firm level, with individual businesses increasing in size.

“It also found that the Fund was contributing to broader outcomes such as companies taking on increased risk in international markets, and improving their strategy and internationalisation processes. The Fund is prompting increased investment by businesses.”

A number of changes will allow the Fund to focus support on the companies where the need is greatest, and also allow more companies to access it, Mr Groser says.

“These changes will allow more exporters to access the funding and ensure the IGF is making the strongest possible contribution to the Government’s efforts via the Business Growth Agenda to grow exports.”

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The changes that will take effect from 1 July are:

· The government to business co-funding ratio, currently 50:50, will reduce to 40:60 to reflect the improving world economic situation in the years since the fund was established;

· To encourage greater collaboration between businesses, multi-company coalitions will be eligible for funding of up to $900,000 per coalition over three years;

· Companies that have received the maximum funding from the Fund will be re-eligible for support after three years, rather than five, to allow them to respond more quickly to emerging growth opportunities; and

· Companies with annual international revenue of more than $500 million will no longer be eligible for IGF grants, so that support is targeted to companies that most need it to invest in their international growth projects.

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