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 a major software project.
“This modernises our free trade agreement and ensures it will remain fit for purpose for another decade,” said Minister for Trade and Export Growth Damien O’Connor.
“This upgraded agreement comes at a time of considerable global economic disruption due to Covid-19. The upgraded free trade agreement is part of the Government’s Trade Recovery Strategy, in response to the economic shock of Covid-19.”
O’Connor signed the upgraded agreement at the Beehive in Wellington through a virtual signing ceremony with China’s Minister of Commerce, Wang Wentao, who participated from Beijing.
“China is one of New Zealand’s most important relationships. Signing this agreement today builds on the significant benefits both countries have enjoyed as a result of our existing FTA,” O’Connor said.
Key outcomes of the upgrade include new rules that will make exporting to China easier and reduce compliance costs for New Zealand exports, a better deal for New Zealand services exporters through expanded market access and most-favoured nation commitments, and the introduction of environmental considerations.
The upgrade will also mean that 99% of New Zealand’s nearly $3 billion wood and paper trade to China will have tariff-free access to China.
The Government says these outcomes will bring tangible benefits to a range of New Zealand businesses, including exporters of perishable goods such as seafood, the forestry sector, and other primary sector industries.
In dairy, existing conditions have been maintained, with all safeguard tariffs to be eliminated within one year for most products, and three years for milk powder.
“This means that by 1 January 2024, all New Zealand dairy exports to China will be tariff free.
“Protections in the existing agreement that are important to New Zealanders, such as our rules on overseas investment and the Treaty of Waitangi exception, remain in place,” O’Connor said.
President of the Forest Owners Association Phil Taylor says the upgrade brings immediate benefits to the forestry industry and is a reminder of the value of rules-based trade agreements globally.
“It consolidates our trade access into China and opens the way for more processed timber exports going there,” he says.
Taylor adds that the upgrade would increase New Zealand’s forestry industry’s market share to 10% in China.
Export NZ executive director Catherine Beard says the agreement is an important step for the ongoing relationship with China.
“At a time of global economic disruption due to Covid-19, the upgraded FTA will be met with a sigh of relief by some exporters,” she says.
Beard says that China is one of New Zealand’s most valuable trading relationships.
“This will bring huge benefits to our exporters of perishable goods like seafood, dairy, the forestry sector and other primary sector industries.”
Meat Industry Association chief executive Sirma Karapeeva says the deal will simplify export procedures.
“We anticipate a reduction in the time our exporters spend waiting for goods to clear customs, enhanced transparency and predictability for businesses, which is great news for New Zealand’s largest manufacturing sector and farmers,” Karapeeva says.
“The strategic value of an FTA upgrade with NZ’s largest trading partner cannot be underestimated and this agreement highlights a deepening of our bilateral relationship with China.”
Sam McIvor, chief executive of Beef + Lamb New Zealand, congratulated O’Connor and the negotiating team.
“We understand that the ongoing Covid-19 pandemic has presented challenges to the negotiation of this agreement and we appreciate the work that both sides have put in to conclude this process,” McIvor says.
“Reaffirming the strength of this relationship through the FTA upgrade is significant and confirms the importance of China as one of New Zealand’s most important trading partners.”
Parliament will now consider the agreement for ratification as part of New Zealand’s treaty examination process before it enters into force.
