Nelson in Focus

Economy Overview

The Nelson economy is founded on a diverse and robust industry base. The ‘big four’ sectors are farming (horticulture and agriculture), tourism, seafood and forestry. Operators in these sectors have improved efficiency and productivity in the past five years and continue to provide the region with millions of dollars of export earnings. Total value-added GDP for the region is estimated at $3.2 billion for the 2006 year. The ‘big four’ drivers above make up 31% of the region’s GDP, with other important contributors being construction, health, education, natural products, arts and culture, engineering, business services, aviation, and the retail sector.

The Cluster Concept

The contribution of each of the ‘big four’ drivers to the regional economy has been analysed using the cluster concept, which pulls together all of the components that make up the industry from the various industrial sectors, including downstream businesses such as processors and service industries.

Driver Clusters of the Nelson Regional Economy

Significant export driving clusters in the regional economy are:

• Horticulture
• Pastoral products
• Forestry and wood products
• Tourism
• Seafood

Developing clusters are:

• Engineering technologies
• Art and craft
• Aviation
• Information and Communication

Emerging clusters are:

• Wellness
• Natural products
• Research and science

Employment by sector

Nelson Tasman has a strong concentration of employment in the primary production industries of agriculture and horticulture, forestry and logging, commercial fishing and seafood processing. The significance of these clusters is further evidenced through the high concentration of employment in the secondary industries of food and beverage, and wood and paper product manufacturing. The tourism industry employs a large number of people in accommodation, cafés, restaurants, arts and retailing. The downstream impacts of high population growth and the buoyant housing market are shown in the performance of the construction sector where employment increased by 47% between 2001 - 06 and the value-added GDP increased by a massive 60%.

Economic Development

In response to the need to develop a strategy for economic growth, the Economic Development Agency (EDA)) was established in 2003, funded by Nelson City Council and eligible for project assistance from central government and other sources. The purposes of the EDA are to coordinate, promote, facilitate, investigate, develop, implement, support and fund initiatives relating to economic development, employment growth and improved average incomes within the Nelson region for the benefit of the community.

The EDA is working to bring together the seafood, arts and culture, tourism, wood processing, marine engineering, horticultural and farming sectors to explore cross-cluster collaboration that will help spawn new alliances and projects. In 2007 the Regional Development Strategy was updated to incorporate sector changes and new emerging clusters.

The strategy for the EDA centres on the development of Nelson Tasman as a ‘smart sustainable’ region. Nelson and Tasman both have Long Term Council Community Plans as required under the Local Government Act. The research done in establishing the EDA, and the strategic aims identified, have fed into and will continue to feed into these plans.

-top-

The Economy - Historical Foundation

From as early as the ninth century iwi in Te Tau Ihu had a custodial and occupational relationship with the land and seascape that remains fundamental to their identity. Early Maori valued the region’s productive fishing grounds, safe harbours, fertile land and prized argillite quarries.

When the settlers arrived in the mid nineteenth century, mutually beneficial trade began with Maori. The early settlers depended on fresh vegetables, meat and fish for their survival, opening up a new market for tangata whenua (people of the land) products.

The first European settlers were the pioneers of the New Zealand Company’s planned settlement of Nelson, which began in 1842. As with the colony’s other settlements, the first task was to become self sufficient in food. The staple diet included pork, potatoes, fish, pumpkins, cabbages and melons. Newspaper reports of the first Anniversary Day indicate the settlers surprised themselves with the productivity of their gardens, but winters were hard and in the second winter the settlement came close to famine.

Entrepreneurial tangata whenua soon had fleets of ships trading regionally, nationally and internationally. Extensive gardens supplied produce and Maori were involved in all of the key industries, including flax, timber, gold and fishing. Tangata whenua embraced new technology and adapted it to add value to the tribal economy.

The colonial period brought unjust disenfranchisement of tangata whenua that included individualisation of title, land alienation and statutory discrimination. In light of this, Maori survival and development is impressive.

20th Century Growth

By the late 19th century the settlers’ farms and orchards had developed and, though Nelson lacked large pastoral runs, the region’s proximity to the capital by sea provided a market for the extractive timber industry based on native forests, apples and fish sent daily by ferry.

Over time, Nelson developed extensive market gardens, orchards and berryfruit farms and today this ‘fruit bowl’ of produce is exported worldwide, as are an increasing number of secondary products such as wine and olive oil. Forestry products and seafood have remained important throughout. The tourism sector based its domestic marketing on the slogan ‘Sunny Nelson’ for most of the 20th century and offered beach carnivals and camping grounds to lure southerners. Today these industries are more sophisticated, using modern technology, communications and marketing to sustain and enhance the Nelson Tasman economy.

Iwi of Te Tau Ihu are expecting a Treaty settlement at press time and they are predicted to grow as investors in and managers of the region’s resources. The region is their residential and spiritual base - they have a very long term commitment to manage and use the land and sea for coming generations.

Note: One hectare = 2.47 acres

Like to know more?

Nelson Regional Economic Development Agency
Bill Findlater CEO
Ph: + 64 (0)3 545 6858,
Email: info@eda.co.nz

up to Nelson in Focus | on to Horticulture