New Zealand Innovation Strategy Risks Costing Country Billions in Global R&D – CEO

New Zealand risks missing out on billions of dollars in global research, product development and commercialisation activity by focusing too heavily on locally owned companies, according to international entrepreneur Peter Price.

Price says the New Zealand innovation strategy should expand beyond encouraging domestic companies to spend more on R&D and actively compete for research, intellectual property, testing and early commercialisation work undertaken by international businesses.

Business research and development spending reached $4.1 billion in 2025 but increased by only 0.4% from the previous year, according to the Stats NZ Research and Development Survey 2025. Global R&D expenditure, meanwhile, is estimated at around US$3.8 trillion annually.

Across business, government and higher education, New Zealand spends around 1.54% of GDP on research and development, compared with an OECD average of about 2.7%. At the current size of the economy, matching that level would represent almost $5 billion in additional annual R&D activity.

Why New Zealand Innovation Needs a Broader Global Strategy

Price says the country should not look only to domestic firms to generate the next wave of growth. He believes New Zealand innovation policy should also compete for research, intellectual property, design, prototyping, consumer testing and early commercialisation work already being undertaken by international businesses.

“New Zealand already has a $4 billion business R&D economy, but the latest figures suggest that growth is effectively flat. At the same time there is a global R&D economy worth trillions of dollars every year.

“The question should not only be how New Zealand companies are encouraged to spend more, it should also be how we persuade global companies to undertake more of their research, product development, testing and early commercialisation here.”

Price points to the Active Investor Plus visa, often referred to as the “Golden Visa”, as evidence that New Zealand can build a targeted proposition for internationally mobile capital. He argues a similar approach could be developed for companies deciding where to conduct high-value innovation work.

His proposed “Launch New Zealand” programme would give domestic and international businesses a clearer pathway into the country’s research capability, universities, consumer testing, compliance guidance, professional services, distributors and commercial partners. The concept would not lower regulatory standards, but would package existing capability to make New Zealand innovation easier for global businesses to access and understand.

“The objective should be to make New Zealand an innovation hub, not simply an incubator for New Zealand-owned businesses.”

Tazi Launch Offers a Test Case for New Zealand Innovation

Price’s argument is informed by his decision to choose New Zealand for the first commercial launch of Tazi, a femcare venture developed following a five-year research and development programme in this country. The product is described as a world-first bendable and reusable femcare innovation and New Zealand was selected ahead of Australia and larger overseas markets for the first stage of its rollout.

Price says the country’s relatively small consumer market can be an advantage during the period between product development and international scale. A population of about 5.36 million, combined with high internet access and an established research workforce, can allow companies to stay closer to consumers and respond more quickly to feedback.

“When you are introducing something consumers have never encountered before, the ability to stay close to those consumers, understand what they are saying and respond quickly can initially be more valuable than access to tens of millions of potential customers.”

For some businesses, the first market is less about maximum sales than learning how consumers respond, where adoption barriers emerge and what needs to change before a wider international launch. Tazi’s development illustrates how global companies can use New Zealand innovation capability without being founded here. Kiwi women were involved in five years of research and development that helped shape the product’s design, usability and performance.

How a Better New Zealand Innovation Strategy Could Build Local Capability

Price says attracting more international R&D could have wider benefits for local companies and researchers. Overseas sources already accounted for around 16% of funding for business R&D undertaken in New Zealand in 2024, according to figures cited in his analysis.

He argues that global research and product development can bring specialist skills, experienced entrepreneurs, intellectual property and international commercial relationships into the country. In turn, those capabilities could deepen New Zealand innovation networks and strengthen the professional services, research and commercial infrastructure available to the next company considering New Zealand.

“Investment in innovation brings more than capital,” he says.

“It attracts people, specialist knowledge, intellectual property, commercial relationships and international experience.

“The more global innovation that moves through New Zealand, the more capability our own researchers, companies and professional services firms develop.

“That becomes another reason for the next international company to come here.”

His broader argument is that New Zealand innovation policy should compete for the highest-value stages of product development regardless of where a business was established. That would mean treating research, design, intellectual property, testing and commercialisation as activities New Zealand actively seeks to attract as well as generate domestically.

PR Support for Innovation, Technology and Commercialisation

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As competition for research investment intensifies internationally, the debate is likely to extend beyond how much local companies spend on R&D. The larger question is whether New Zealand innovation can become sufficiently attractive, connected and commercially useful to draw a greater share of the trillions of dollars already being invested globally.