Tuesday, 28 September 2021 11:55

NZ welcomes China's bid to join Asia/Pacific trade deal

Written by  Peter Burke
Stephen Jacobi says China's move signals it's open for further trade reform. Stephen Jacobi says China's move signals it's open for further trade reform.

There's been generally positive reaction to China's announcement that it will seek membership of the Comprehensive and Progressive Agreement on Trans Pacific Partnership (CPTPP).

The CPTPP is a free trade agreement between Australia, Brunei, Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore and Vietname which was signed by the 11 countries in March 2018.

The executive director of the NZ International Business Forum, Stephen Jacobi, described the move by China as a welcome expression of its interest in further trade reform. He says trade agreements like CPTPP are about the spread of effective and up-to-date trade rules in the Asia Pacific region as well as globally. He says the CPTPP clearly provides for the accession of new members who can demonstrate they can meet its high standards and is a pathway towards a future Free Trade Area of the Asia Pacific.

He says NZ and China already have a high quality trade agreement that has recently upgraded. He says both countries are cosignatories of the Regional Comprehensive Economic Partnership (RCEP), which includes other Asian countries such as South Korea, Indonesia, Thailand and the Philippines.

"When the remaining dairy safeguard tariffs are completely withdrawn from 1 January 2024, NZ will enjoy very favourable market access into our largest trading partner, China," he told Dairy News.

"It is therefore well placed to meet NZ's expectations for the elimination of tariffs and non-tariff barriers. For the CPTPP bid to be successful, China will need to demonstrate its ability to meet the high standards of other aspects of the agreement, including in relation to competitive neutrality to state owned enterprises," he says.

The issue of the dairy safeguard tariffs is one that the Dairy Companies Association of NZ chairman Malcolm Bailey is interested in. He says this is an issue the dairy industry would want to see addressed quickly if China were to join the CPTPP.

When the China/NZ FTA was negotiated in 2008, China insisted on safeguard clauses being inserted into the FTA. This means that once dairy exports to China reach a certain threshold, tariffs kick in.

The problem is these were set at a level which in 2008 looked good in NZ, but is clearly out of date given the volume of dairy exports to China today. As Jacobi says, under the revised China/NZ FTA these are due to be phased out in 2024. Such tariffs cost NZ millions of dollars.

But Bailey says if China wanted to make quick progress to join the CPTPP, he'd like to see the issue of the safeguard clauses become part of that negotiation.

"In principle I am supportive of China's approach. Every expansion of the global trade agenda is a good thing and there is a strong correlation to opening up trade and welfare of people worldwide," Bailey says.

More like this

Editorial: NZ's great China move

OPINION: The New Zealand red meat sector, with support from the Government, has upped the ante to retain and expand its niche in the valuable Chinese market - and the signs are looking positive.

Positive vibes from China

Silver Fern Farms chief executive Dan Boulton says his recent visit to China has left him feeling optimistic about the situation there for the meat industry.

Chinese strategy

OPINION: Fonterra may have sold its dairy farms in China but the appetite for collaboration with the country remains strong.

Featured

Massey Research Field Day attracts huge interest

More than 200 people turned out on Thursday, November 21 to see what progress has been made on one of NZ's biggest and most comprehensive agriculture research programmes on regenerative agriculture.

Expo set to wow again

Stellar speakers, top-notch trade sites, innovation, technology and connections are all on offer at the 2025 East Coast Farming Expo being once again hosted in Wairoa in February.

A year of global challenges

As a guest of the Italian Trade Association, Rural News Group Machinery Editor Mark Daniel took the opportunity to make an early November dash to Bologna to the 46th EIMA exhibition.

National

OSPRI's costly software upgrade

Animal disease management agency OSPRI has announced sweeping governance changes as it seeks to recover from the expensive failure of…

Machinery & Products

BA Pumps expand

Cambridge based BA Pumps & Sprayers, specialists in New Zealand-made spraying equipment, has acquired Tokoroa Engineering’s product range, including the…

Entries open for innovation award

Fieldays and its renowned Innovation Awards are celebrating their 57th year, marking a longstanding tradition in the agricultural calendar, with…

» Latest Print Issues Online

Milking It

Chinese strategy

OPINION: Fonterra may have sold its dairy farms in China but the appetite for collaboration with the country remains strong.

Not fair

OPINION: The Listener's latest piece on winter grazing among Southland dairy farmers leaves much to be desired.

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter