WELLINGTON (Reuters) - New Zealand will launch a new visa to attract technology entrepreneurs as it tries to offset its struggling dairy industry, but it may struggle to beat Australia in the race to become the Silicon Valley of the South Pacific.

Up to 400 Global Impact Visas would be offered over a four-year pilot beginning later this year, the New Zealand government said on Friday. This follows Australia’s announcement in December of its “entrepreneur visa” as part of a raft of measures to boost innovation.

A downturn in commodity prices over the past two years has brought an end to Australia’s mining boom, while low global dairy prices have slashed the incomes of farmers in New Zealand, the world’s largest dairy exporter.

Both countries have since been forced to diversify their economies, leading to an increasing focus on the high-value technology sector.

New Zealand Immigration Minister Michael Woodhouse said the aim of the global impact visas was to “help expand the pool of smart capital by attracting individual investors and entrepreneurs to live here in New Zealand”.

But some in the industry felt that a visa program alone would not be enough to mark New Zealand on the international map and draw high-caliber technology entrepreneurs from around the world to the remote island nation in the South Pacific.

“There isn’t really a technology plan that’s unique to New Zealand that exploits a new digitally connected world,” said Rod Drury, CEO of Xero, a financial technology firm based in Wellington that is expanding in the U.S. market.

“Because we’re such a small market and we’re the furthest country away from any other trading partner, then it’s so much more important for us,” he said.

By contrast, Prime Minister Malcolm Turnbull announced Australia’s visas in December as part of more than 20 measures in an ambitious A$1.1 billion (574 million pounds) plan to boost innovation and spark an “ideas boom”.

Its incentives include reductions in the capital gains tax for startups, generous income tax rebates for retail investors, and changes to bankruptcy laws to encourage more risk-taking by entrepreneurs, as Turnbull - a millionaire former tech businessman - staked Australia’s claim as an innovation hub.