Trade deals open doors to wealth
New Zealand’s wealth is driven by our exports, and anything the Government can do to improve our ability to export adds to our country's wealth. This week there have been two initiatives announced by the Government designed to do just that.
- Prime Minister John Key’s announcement that negotiations have commenced to upgrade the China Free Trade Agreement (China FTA)
- Trade Minister Todd McClay and opposition MPs will be travelling to Europe and Iran next week to take part in a number of trade-related events.
It has been 8 years since the China FTA came into force, a trade deal which has resulted in China becoming our second largest goods and services export market, and our largest export destination for goods totalling $12.2 billion. China is a very important market for horticulture, particularly apples and kiwifruit, with our horticultural exports now worth around $464m. But there are horticultural products such as avocados and onions that do not as yet have access to China, and we therefore welcome the announcement for the China FTA to be upgraded, so that all our products can be exported to China.
With Brexit and the negotiation for a Free Trade Agreement with the European Union underway, New Zealand absolutely needs to engage more broadly in trade-related activities in Europe. Italy, France and the United Kingdom are collectively worth more than $9.2 billion of two-way trade, and are home to 190 million consumers. Britain and Europe are also very significant destinations for our horticultural produce; apples, kiwifruit, onions are all important exports from New Zealand, with horticulture’s exports to the continental European market valued at $518m, and the UK and Ireland at $154m.
Both these trade enhancing developments are timely because of President-elect Trump’s decision to pull the US back the TPPA trade deal. Whatever happens, New Zealand needs to be working on all possible trade improvement avenues to ensure our continued economic success.
- Mike Chapman, CEO