Sector-based projects

The Provincial Growth Fund (PGF) invested in projects across key sectors to support growth in the regions and attract business and private investment.

These key sectors included manufacturing and engineering, energy, food and beverage, aquaculture, forestry and wood processing and tourism.

We also refer to these as Tier 2 investments.

To qualify for funding, projects needed to align with the PGF’s objectives while creating employment and training opportunities.

As part of New Zealand’s COVID-19 recovery, the PGF was refocussed in May 2020, with at least $600 million directed to projects which could provide more immediate economic benefits.

Sector investments were revised to also include:

  • Immediate capital investment
  • Māori and Pasifika Investment

PGF reset helps regional economies —

PGF Position Paper — Tier 2 Sector Investments — MBIE

Food and beverage

A focus of Provincial Growth Fund (PGF) investment was food innovation. This included supporting the processing and manufacturing of food items and the sustainable use of land, infrastructure and technology to increase production.

Projects which received PGF support covered a wide range of initiatives, from providing horticulture and agriculture workers with more skills and training to creating collaborative environments and developing new food products.

This bolstered the wider industry at the same time as helping create the employment opportunities so crucial for a regional economy.

The PGF supported projects which:

  • sought co-investment in value-added food and beverage processing and manufacturing. This included support for regions to process and package locally grown produce able to be sold at a premium
  • provided formal and informal training, mentoring and work experience to local workers so they could acquire the skills required in their region now and in the future
  • supported higher-productivity and sustainable use of land, such as lifting the productivity of Māori-owned land and supporting land conversions to higher-value crops with lower environmental impacts. 


The Provincial Growth Fund (PGF) prioritised investment in regional infrastructure to help grow high-value tourism. The PGF invested in projects which:

  • encouraged year-round tourism to a greater number of regions
  • reduced existing pressure on tourism infrastructure, particularly in communities which lacked local funding capacity
  • added value to the tourism and visitor economy
  • enhanced the productivity of tourism businesses, drove innovation and supported professional tourism career development
  • improved the industry’s sustainability and helped it transition to a low-emission footprint
  • developed Māori cultural assets.

Proposals ranged from building artistic, historical and cultural installations to centres catering for increased domestic and international travellers.

To reduce the impacts of COVID-19, the Tourism Minister announced a $400 million targeted Tourism Recovery Fund which included the Tourism Transitions Programme and Digital Capability. The package provides support at a business-level.

Cabinet agreed that Kānoa – Regional Economic Development & Investment Unit (Kānoa – RDU) should administer funding under the Strategic Tourism Assets Protection Programme (STAPP). This is one of the key initiatives supporting regional level tourism.

Read more about the STAPP allocation: 

Strategic Tourism Assets Protection Programme — MBIE

Forestry and wood processing

Forestry plays an important role in many regional economic action plans and land transport plans.

The Provincial Growth Fund (PGF) invested in projects which;

  • supported Māori to achieve forestry-related economic growth
  • created safe and rewarding jobs in forestry
  • delivered positive environmental outcomes by strengthening the domestic market
  • provided wood products for domestic consumption to aid recycling,
  • encouraged greener construction alternatives
  • supported projects where Māori cultural development is a key component
  • supported security of supply for wood processors.

The Government developed the One Billion Trees programme to increase the number of trees being planted across New Zealand with the goal of one billion new trees being planted by 2028. This programme’s benefits range from greater native and exotic forest diversification to supporting local communities.

The programme targets employment for Māori and Pasifika communities, support for Māori aspirations for land use and control of erosion to improve water quality.

Kānoa – RDU has partnered with Te Uru Rākau Forestry New Zealand to administer funding for the projects which meet this criteria, whilst wider forestry sector initiatives are supported by the Ministry for Primary Industries.

To help the industry recover from COVID-19, the PGF supported businesses so they could  maintain production levels and retain their workforce. Read about some of the PGF-supported forestry and wood processing projects: 

PGF Position Paper: Wood Processing investments — MBIE


Aquaculture produces seafood and products which embody New Zealand’s brand of food which is sustainable, healthy and high value.

Global demand for premium seafood is already high and is expected to grow further. New Zealand’s aquaculture industry is well placed to help meet this demand, sustainably.

In 2020, the aquaculture industry generated more than $600 million in annual sales. It has a well-established, strong record of growth and, through innovation and more sustainable practices, there are opportunities for even further development.

The 2035 target for the aquaculture industry is $3 billion in annual sales. 

The Provincial Growth Fund (PGF) made several investments in the aquaculture industry’s transformation in order to bring forward job and income opportunities while supporting New Zealand’s economic recovery in the wake of COVID-19.

Digital connectivity

The Provincial Growth Fund (PGF) partnered with Crown Infrastructure Partners (CIP) to connect communities and improve regional New Zealand’s digital infrastructure.

This investment in four digital connection programmes has helped rural communities stay connected to the rest of the country:

  • Marae Connectivity: installation of broadband networks, hardware and technical support to connect regional marae
  • Regional Digital Hubs: establishment of hubs providing a range of digital services and equipment
  • RBI2 and MBSF expansion: extension of the government’s Rural Broadband Initiative Phase 2 (RBI2) and Mobile Black Spot Fund (MBSF)
  • West Coast of South Island connectivity: construction of the Haast Fibre Loop and Milford Highway Fibre Connection, extending mobile coverage on the West Coast and accelerating Ultra-Fast Broadband (UFB) towns on the West Coast. 

Marae connectivity

Connecting marae has opened up business and education opportunities in communities at the same time as helping whānau to stay in touch with each other and connect with their iwi. 

Kānoa – RDU worked alongside Te Puni Kōkiri (TPK) to assess proposals and identify the marae that were eligible for digital connection funding.

Marae Digital Connectivity — Te Puni Kōkiri

Regional Digital Hubs

Regional Digital Hubs provide key digital services. These often include free Wi-Fi, co-working spaces for business and council activities, event spaces, support for technical activity and guidance on how to use the internet for business purposes.

These hubs have been primarily established in the Provincial Growth Fund's surge regions - Northland, Bay of Plenty, East Coast / Tairāwhiti, Hawke’s Bay, Manawatū-Whanganui and the West Coast.

Rural Broadband Initiative Phase 2 and Mobile Black Spot Fund

Remote areas of New Zealand received greater internet and mobile coverage through the Rural Broadband Initiative phase 2 (RBI2) and Mobile Black Spot Fund (MBSF) expansion.

These investments were focused in surge regions.

South Island connectivity

Investment in digital connectivity for the West Coast and Milford aims to extend and improve mobile coverage while accelerating Ultra-Fast Broadband (UFB) connections for rural communities.

The Haast Fibre Loop between Fox Glacier and Lake Hawea and the Milford Highway Fibre Connection into Milford Sound will provide bandwidth into both areas. This will support increased data through mobile towers under the RBI2/MBSF programme.

Read more about a project enhancing regional connectivity in the West Coast and Southland:

Better digital connectivity coming for West Coast and Southland —