Growth tops the agenda for 2025

‘Survive until 2025’ was the narrative that dominated headlines last year as a tough cycle of recession and rising unemployment took hold. Now, a quarter of the way into 2025, economic growth is high on the agenda for businesses and boards, as many start to see and feel the signs of recovery, with interest rates dropping and inflation starting to settle.

While we are not completely out of the woods yet, we are seeing the mood of the nation starting to lift. Business and consumer confidence is rising and average mortgage interest rates have fallen for the first time in more than three years. 

Households and businesses are beginning to see green shoots and now is the time to turn our focus to unleashing the growth we need, to strengthen our local businesses and create more opportunity for New Zealand. 

We need to change our mindset as a country and as business owners from one of restriction to rallying for change. A successful business strategy for the next 12 months will have to balance short-term financial and economic turbulence with the need for organisations to focus on the future. 

Part of that is being laser-focused on how we can use and leverage technology and understand more fully how it can shift the dial through greater efficiency and productivity. 

Comparing ourselves to other well-developed countries, the harsh reality is that New Zealand is lagging when it comes to productivity. Promoting growth and investment into innovation has never been so critical, but we also need to build confidence and capability in our businesses and our people to unlock this productivity. 

A report commissioned by ASB in 2024 with the New Zealand Institute of Economic Research (NZIER) shows that for New Zealand to increase productivity, business leaders need to be more ambitious, be prepared to invest and innovate, and enable their workforce to adapt.

Businesses and the non-government sector need to take leadership by developing skills, adopting new technology and being more flexible and open. They can start by collaborating and building sustained ecosystems to support innovation, and ASB wants to support them to do that. 

One way we are showing our commitment and collaborating with industry is by partnering with the Employers and Manufacturers Association (EMA) on its Manufacturers Workshop series across New Zealand. The workshop, ‘The Impact of Industry 4.0 on Your Business’, demystifies the Fourth Industrial Revolution, also known as Industry 4.0, breaking it down to the nuts and bolts of what it means for your business in a practical sense. 

The manufacturing sector is just one of many that could risk losing ground without investment into critical automation and productivity improvements. A sector currently struggling with increasing global competition, outdated technology and a lack of research and development to drive innovation, the convergence of artificial intelligence, cloud connectivity and real time data analytics will prove crucial in shifting our manufacturing sector from lagging to leading in the global market.

Investing in innovation now will unlock benefits and choice for New Zealand, with the potential to raise real GDP to $500 billion by 2045. Through these workshops, we are getting behind business growth and living our purpose of accelerating progress for all New Zealanders.

Delivered by the EMA and the experienced team at LMAC, the workshops are for business decision-makers who are ready to embrace digitisation and automation to build their business’s competitiveness. Through learning from others, this is the first step for many in exploring how a range of technologies can make their business more productive. 

With some economic pressure easing, investment in digital transformation and upskilling your workforce can pay off and build a foundation for the long haul. Now is a good time to invest in a tech upgrade or training programme that is relevant to your industry, focusing on making your organisation more adaptable for the future.

The NZIER report also showed banks have a role in supporting businesses, by helping them secure capital through both mainstream and innovative financing solutions. 

We often hear from business leaders after they have decided to invest that they wish they did so sooner. Financial tools and insights are available to empower customers to make the right decisions for their business. We are embracing innovation in our approach to banking business too, with a series of lending initiatives for changemakers.

Just over a year ago we announced innovative lending and ecosystem support for sustainable food and fibre exporters through our ASB ACCESS fund, which has seen $20 million of lending approved to support food and fibre exporters and innovators with capital and global network opportunities. 

We also announced lending for early-stage clean tech innovators, to boost the sector’s growth, with $30 million already approved to support customers to develop tech that reduces carbon emissions. 

We are continuing to support exporters and innovators with capital and global network opportunities, as well as boosting our internal capability in the critical food and fibre sector.

This commitment to innovation needs to be applied across the economy. For business, that means building an understanding and appetite for innovation and investment as an engine for growth and sustainability. 

The potential exists and the best is yet to come. Investing for growth can be a big step and we are backing these businesses to move New Zealand forward.