Anthropic director Chris Liddell’s warning for New Zealand – don’t miss the AI tsunami

And yet, the honest verdict, 25 years on, is that the overall impact on New Zealand has been, at best, modest. Not because the ideas were wrong. But because turning ideas into structural economic transformation requires something we find genuinely difficult: sustained, grinding, whole-of-economy follow-through. We are good at conversation. We are less good at the hard work of implementation that must follow. New Zealand can be small and nimble. We are not always able to be.

High stakes

I believe we are about to face a far larger transition with incomparably higher stakes. The artificial intelligence revolution is not a knowledge wave. It is a tsunami, coming with exceptional opportunities and challenges.

Chris Liddell (front right) with his former Microsoft colleagues.

My old boss, Bill Gates, has long observed that we overestimate the short-term impact of technology but underestimate its long-term impact. With AI, progress is not linear; it is exponential, and the long term is arriving far sooner than we expect. The future that many experts imagine arriving in 20 years may be five years away.

Dario Amodei is the CEO of Anthropic and one of the most credible voices on the future of this technology. He is a grounded scientist leading one of the world’s most important organisations at a time of momentous change. He has written two essays that every New Zealand policymaker, business leader and citizen should read.

In Machines of Loving Grace, he sketches the massive upside of powerful AI, the prospect of compressing a century of medical and scientific progress into a single decade, of eliminating diseases that have plagued humanity for millennia, of dramatically expanding access to education and economic opportunity across the globe.

In his second essay, The Adolescence of Technology, Amodei is more sobering. He argues that humanity is about to be handed almost unimaginable power and that it is unclear whether our social, political and technological institutions possess the maturity to wield it wisely. This is a passage, he writes, that will test who we are as a species.

Extraordinary opportunity

What does this mean for New Zealand?

It means the opportunity is extraordinary. It also means that the cost of our often-characteristic inertia has never been higher.

The United States and China will dominate the global AI race. New Zealand cannot and should not try to compete on their terms. But scale is not the only path to significance. Switzerland became a global centre for finance and pharmaceuticals, not through size, but through trust, quality and strategic positioning. Singapore, a city-state of six million, has attracted more than 60 global AI centres of excellence from Google, Microsoft and others, not because it has the biggest market, but because it offers speed, stability and the rule of law.

Bjorn Stigson, former chairman of the World Business Council for Sustainable Development, gives a keynote address at the Knowledge Wave leadership Conference in 2021.

New Zealand holds some baseline advantages for the AI age. A global reputation for integrity and trustworthy governance. A transparent regulatory environment. Abundant renewable energy, a critical and increasingly scarce resource for the data centres that power AI. A government with the structural capacity to move fast. And a unique indigenous worldview, Te Ao Māori, that offers a genuinely different perspective on data sovereignty, collective benefit and the ethics of technology.

Evolutionary biology teaches us that change comes from the edge of the species. New Zealand has always been a place at the edge geographically, culturally and institutionally. That is not a disadvantage in a world being remade by AI. Being a laboratory for ideas, a place nimble enough to experiment and iterate at speed, is a genuine strategic asset. The countries that will lead are not necessarily just the biggest. They are the boldest.

Total commitment

This time the boldness must be backed by something the Knowledge Wave ultimately lacked: a genuine, sustained, whole-of-economy commitment.

On the government side, what is needed is a substantive, ongoing set of enabling policies. A menu of ideas worth considering includes the introduction of programmes such as Singapore is using to facilitate adoption among SMEs, an AI Talent Visa to attract the world’s best minds, a Sovereign AI Infrastructure Fund that leverages our renewable energy advantage, sector-specific AI missions facilitated by government leadership in agritech, biosecurity and climate, where New Zealand has genuine competitive credibility.

AI can also make the government itself both more efficient in delivering existing services and more effective in adopting new delivery models. This will require a serious programme to drive AI adoption through every part of the government. The government can use it to significantly increase its policy cadence, speed up regulatory clearances and do a regulatory “clean-up” that eliminates conflicting or low-value regulations. AI will open major opportunities in personalised medicine and education, two of the country’s largest sectors in need of re-imagining. New Zealand could be at the forefront of their experimentation and application.

Last, but critically, we need a national AI Literacy programme. The good news here is that the AI tools are significantly easier to use than in previous technology developments. The anxiety many workers feel about AI displacement is real, and the answer is a genuine investment in every person’s ability to adapt and to benefit from AI.

The government cannot do this alone. The private sector must step up by investing in AI capabilities and building the new companies and platforms that a modern economy requires. This will require “top down” driving from business leaders willing to invest in AI applications, and “bottom up” ideas from all levels of the organisation, empowered by the general deployment of frontier models to every employee.

There are opportunities for significant advances in making existing companies more productive, an area New Zealand has consistently lagged in, but also new growth. There has never been a better moment in New Zealand history to start or scale a technology company or reimagine existing industries. The ability to create something that I wrote about 20 years ago, “mini multinationals”, has never been greater. Designed, conceived and owned in New Zealand but produced and distributed internationally, eliminating the tyranny of distance that has plagued New Zealand in the past.

I am a director of Commonwealth Fusion Systems, the leading US company developing fusion energy, the most promising source of future, unlimited, clean energy for the planet. Openstar in New Zealand is taking an innovative, less capital-intensive approach to the same challenge. AI will facilitate many more of these types of companies. Perhaps using AI-integrated robotics for high-value, low-volume manufacturing in New Zealand to offset high shipping costs. Or empowering the digital effects industry with proprietary AI tools to produce more world-class films and gaming content. Or personalised eco-tourism with AI concierges that create hyper-customised travel itineraries, managing tourist flows to protect our environment while maximising spend.

For Māori entrepreneurs and iwi, in particular, the AI moment offers something the Knowledge Wave only gestured toward: real structural opportunity to build wealth, own platforms and participate in the highest-value parts of the global economy on their own terms.

Chris Liddell (at rear) with Neal and Annette Plowman of the NEXT Foundation.

In the philanthropic sector, AI also opens new worlds. NEXT Foundation, which I chair, is already experimenting with AI in the drive towards a “Nature Positive” country, where we reverse historically negative trends in biodiversity, carbon emissions and ocean health. We hope to attract significant international investment to New Zealand to help with our efforts. Some of these ideas are world-leading and can be applied not only in New Zealand but also be exported globally. More broadly, we believe AI can help create platforms for smaller charitable efforts, for example, by using AI to analyse social data and identify hidden poverty or education gaps, enabling targeted charitable interventions. Or establishing a “shared services” AI lab that provides small charities with the tools and training to automate their fundraising and volunteer management.

These are just a small sample of ideas across the public, private and philanthropic sectors. The opportunities are only limited by our imagination. However, none of them will come easily. There will be no silver bullet, just a broad adoption in every sector and the willingness to embrace new business models and approaches. There will be successes but also failures. It will require relentless commitment.

I have lived outside New Zealand for much of the time since the Knowledge Wave. I continue to care deeply about the country and contribute where I can, mostly through philanthropy, trying to build a legacy in the environment and education.

Working alongside some of the world’s most successful entrepreneurs, investors and leaders, I’ve come to admire what I would describe as relentless pragmatic optimism – the ability to hold multiple conflicting realities simultaneously, with a clear bias towards the positive. Not naive optimism. Not a denial of the challenges. But the understanding that in times of great dislocation, the bigger the disruption, the bigger the opportunity for those bold enough to compete.

Chris Liddell (right) with Microsoft CEO Satya Nadella and Amazon founder Jeff Bezos at a White House tech conference.

I have seen and competed against the best in the world. I believe that New Zealand has the DNA, but we need the attitude. My enduring concern, seen from the distance I have gained, is our tendency towards complacency and incrementalism and more recently, a degree of fatalism. We must fight those attitudes. In the world we are now entering, every country and every citizen has agency. What’s coming will require a fundamentally different level of response and a higher level of aspiration across government, business and the wider public.

Seize the moment

There is a Greek proverb I have carried with me for much of my life, “we should plant trees in whose shade we shall never sit”. Every serious act of nation-building is an act of intergenerational generosity, done not for the people in the room, but for the New Zealanders who will inherit what we choose to do or fail to do now.

We largely missed the Knowledge Wave. The conference and what came afterwards catalysed real outcomes and a brief but genuine sense of national shared purpose. However, measured against the scale of the generational challenge it set out to meet, the honest verdict is that we did not do anywhere enough, fast enough, or with enough sustained commitment. We planted some trees when we needed a forest.

The next wave will be dramatically more significant. The question for New Zealand is not whether the AI tsunami is coming. It is whether, this time, we choose to meet it with the full force of everything we have.

WATCH LIVE: An exclusive Chris Liddell interview with Garth Bray on Herald NOW Business or ThreeNow from 6.30am on Tuesday.

Chris Liddell has been the CFO of Microsoft and General Motors, deputy chief of staff and director of the American Technology Council at the White House, and chairman of Xero. He is currently a resident fellow at the Harvard Kennedy School of Government, the chairman of NEXT Foundation, and a director of the Council on Foreign Relations, Commonwealth Fusion Systems, and Anthropic. He grew up in the Waikato and Auckland, and was educated at Mt Albert Grammar School, the University of Auckland and the University of Oxford.

Catch up on the debates that dominated the week by signing up to our Opinion newsletter – a weekly round-up of our best commentary.