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Why Catch The Knowledge Wave?

16 February 2001



By Dr Christopher Tremewan, Pro Vice-Chancellor, The University of Auckland, and Chairman of the Knowledge Wave Project Team

A new force is driving the world’s most successful societies. Knowledge is replacing the old stores of wealth - land, industrial machines, capital - as the new currency of social and economic success.

It is in these societies that most of the exponential growth in the production of knowledge is occurring: a trend creating global shifts which are as profound as they are swift.

After 40 years of economic under-performance, New Zealand cannot afford to ignore the implications of this new era of knowledge-driven growth if it is to remain among the world’s most developed economies for much longer.

Between 1960 and 1997, New Zealand’s output per head of population grew by 60 per cent, compared with an average 150 per cent-plus on any comparable country basis and there is widespread recognition that all is not well.
See-sawing public sentiment about the country’s future and strong outward migration are but two signs of that,. So, too, is the emerging demand for a strategic approach to regaining our prosperity and competitiveness.

There are good, recent examples to learn from. Countries such as Finland, Ireland, and Israel have all overcome similarly uncertain futures by developing such national strategies. In doing so, they viewed their situation in terms of a “constructive crisis” and have been rewarded with high growth rates and a renewed sense of common national purpose.

New Zealand needs to fashion its own vision, but can learn much from such countries, where national leaps of imagination have transformed prospects in as little as a decade. It is time to reinvent and reinvest in ourselves to ride the wave of knowledge-based social and economic opportunity that is sweeping towards us.

The Catching the Knowledge Wave project is therefore a call to action. The winners and losers of the early 21st century are being determined today. The winners will be those countries that harness the power of knowledge and learning most effectively.

It is time to ask: what does it take to create such a society? What policies should New Zealand adopt to foster a culture of innovation, enterprise, and lifelong learning to create fair, prosperous, and sustainable lives? What are the new roles for government? How do we get the best from the knowledge we already have and from the institutions that produce it? How do we ensure that the best new ideas are turned into promising new businesses? Most crucially, how do we accelerate learning and the pursuit and use of our knowledge so that all these outcomes are achieved as quickly as possible?

The Knowledge Wave project is committed to identifying the elements of a national strategy to start answering those questions.

Participants will work with some of the best thinkers and practitioners in this area to bring forward policy proposals across a wide range of issues including innovation and learning, people and capability, macro-economic policy, entrepreneurship, social cohesion, and environmental sustainability.

This process does not amount to a simple quest for greater material wealth, although New Zealand needs the economic growth rates that knowledge-based businesses can produce

Rather, it is about creating a politically stable, socially cohesive society that New Zealanders will be proud to live and work in, that talented expatriates will choose to return to, and where the citizens of other countries will seek to live, let alone invest.

Nor is this vision solely about information technology, telecommunications, and the Internet. Their impact is huge. But in the same way that electricity transformed peoples’ lives early last century, information technology enables development rather than creates it.

It speeds up and deepens the transfer of knowledge, dramatically expanding our capacity to build new understandings, communities, industries, and markets. Yet most of its tools will soon be as unremarkable as a 60-watt bulb, a background convenience which helps us all to do remarkable things.

In short, the knowledge wave is upon us. We don’t have to go and find it. What matters now is how we harness its huge potential, how well we collectively ride the wave.

Why now? Because for a country that remains too dependent on low-cost agricultural commodities - a dangerously outdated source of advantage in a world of low-cost competitors - time is running out.

We may do well this year with a low exchange rate and high commodity prices, but when prices swing down again, so will our fragile national mood. Our capacity to fund the “fair go” society that we have historically sought will slip that much further away. Yet that does not have to be our destiny.

Making knowledge a key driver of the New Zealand economy is a route to getting off that cyclical bandwagon, as an increasing number of innovative New Zealanders are already recognising.

Sign-posting the future are companies like Wellington’s Compudigm, producing software that makes compelling visual maps of complex data; Southland’s Topoclimate project, which is hunting out micro-climates for high-value crops like tulips and Japanese wasabi; or New Zealand Dairy Ingredients, extracting specialist food and medical additives worth thousands of dollars per kilogram from low value milk. Local creative wizardry is behind the powerful software in Peter Jackson’s “Lord of the Rings” production, while Animated Research Ltd’s Virtual Spectator application has made the America’s Cup intelligible to a global audience of landlubbers.

Then there are new medical therapies such as those being developed by NeuroNZ, a company spun out from The University of Auckland; or the equally exciting discovery of a natural alternative to anti-biotics for throat infections by the BLIS strategic alliance with Otago University. Kiwis tapping local sensibilities to influence international culture are more evidence of the same trend, from the clothes of Karen Walker to the songs of Neil Finn.

These are the building blocks of a knowledge society. We need to create far more of them.

In some respects, New Zealand is well-placed to embrace knowledge as a new engine of social and economic development. We have world-class information technology infrastructure, and Internet use is high by international standards. New Zealanders are known as early adopters of new technology. Almost half of all homes have a computer. One recent report describes New Zealand as “a junior version of the US, heading in the right direction, but lagging behind in critical areas”.

These include new challenges for the education system, low investment in research and development, limited access to venture capital and entrepreneurial skills, and a narrow mix of exports. In 1996, three-quarters of New Zealand exports had low technological input, more than twice the 35 per cent average for all small countries. That figure alone tells us how much we need to change our focus.

For unlike most goods and services, knowledge is powerfully self-perpetuating. It cannot be exhausted or overused. It expands with use in a process that owes as much to education, research, and lifelong learning as the high-value markets that knowledge-based industries will serve.

Such industries are remarkable for producing specialised goods that are priced on their sophistication rather than their cost of manufacture. They increasingly recognise the value of cultural, ethnic, aesthetic and lifestyle differences, with the flow of people and cultural knowledge is as much a part of the emerging global knowledge society as the international flow of goods, services, and capital. National identities are shaken up in this process, but diversity is also more highly cherished.

In this lies the key to the brain drain dilemma. On one hand, the loss of New Zealanders overseas can be seen as negative, and governments everywhere are beginning to recognise that their most skilled citizens will only be attracted to stay if the environment encourages and respects knowledge through learning, innovation, and creativity. On the other hand, New Zealanders who succeed overseas can be seen as assets to us for their capacity to connect us internationally. High-achieving New Zealanders living overseas will be key participants in the Catching the Knowledge Wave conference for that reason.

Meanwhile, the most successful countries are investing with fresh urgency to equip people for the new opportunities and responsibilities of a knowledge-driven world.

However, while it is often expensive to produce, much new knowledge also becomes freely available. When governments take responsibility for ensuring that knowledge remains accessible to all its citizens, it has a democratising impact, creating a force for social as well as economic action.

That is why information technology firms and the Government have teamed up to
bring the Internet to the nation’s poorest schools, recognising that access to the Net is as essential to modern citizenship as access to books in previous generations.

Thus, while the knowledge wave is changing the role of governments, it is also leading to the policies, attitudes, and infrastructure that both foster knowledge and ensures that all citizens have access to it.

This kind of society would explicitly nurture the growing importance of our intangible and cultural assets. It would reframe how we regard knowledge so that new opportunities for social and economic participation begin to open up.

We need to find the settings of a creative national framework that is right for our country, while accepting that unless we reinvigorate our creativity, innovation, and learning, we will continue to slip behind the countries we once thought of as poor.

The Catching the Knowledge Wave initiative is a challenge to go beyond talk and analysis to rethink how we see New Zealand’s future in a consensual and bi-partisan way, and to produce results.


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