7. MARTIN GALLAGHER (Labour—Hamilton West) Link to this
to the Minister of Trade
What are the benefits to New Zealand of the New Zealand - China free-trade agreement?
Hon ANNETTE KING (Acting Minister of Trade) Link to this
The New Zealand - China free-trade agreement signed in Beijing yesterday will result in a net benefit to New Zealanders of between $225 million and $350 million per annum for each of the next 20 years. The benefits fall in three main areas of the economy. In terms of trade and goods, the free-trade agreement will result in an annual tariff saving to our exporters of $115.5 million based on current trade. In the area of trade and services, the free-trade agreement gives New Zealand service suppliers an ability to operate in China generally on the same basis as domestic suppliers. In terms of investment, New Zealand investments in China will get the same treatment and protection that Chinese nationals investing in China get.
What response to the free-trade agreement has the Minister seen from industry, producer, and union groups?
I have seen statements welcoming the significant benefits that the free-trade agreement will provide to New Zealand for many groups including Federated Farmers, Meat and Wool New Zealand, Export New Zealand, the Employers and Manufacturers Association, and Business New Zealand. These organisations have all pointed to the benefits of securing preferential access to New Zealand’s fourth-largest export market. I have also seen comments from Peter Conway, the economist with the Council of Trade Unions. He has said that the phase-down period for the remaining New Zealand tariffs was over a reasonable time period, the labour memorandum gave a channel for unions to raise labour right issues, and there were caps and controls in the case of temporary migration under the agreement.
There are many. but some of the more significant ones are that dairy has an export value of $363 million and amounts to 18 percent of New Zealand’s total exports to China, and tariffs on dairy products will be phased out over a period of between 5 and 12 years; fish and other seafoods, which have an export value of $90 million and amount to 4 percent of our total exports to China, will be eliminated over 5 years; tariffs on wine, for example, are currently 14 to 30 percent and will be phased out over 5 years; and the tariff on ice cream, currently 19 percent, will be phased out over 5 years.