Trade Update - July 2013

  • Date Added: 25 Jul 2013 from BusinessNZ

  • Taiwan

    The big news this month is the signing of the Agreement Between New Zealand and the Separate Customs Territory of Taiwan, Kinmen, Penghu and Matsu on Economic Cooperation (ANZTEC) on 10 July.

    ANZTEC will make New Zealand the only country in the world to have full free trade with China, Hong Kong and Taiwan.  It is not just a good trade agreement, it is a major foreign policy triumph also.  It is concrete evidence of the excellent political relationship with China.  The fact that the deal has been welcomed, and New Zealand’s handling of the negotiations praised formally in public by the Chinese Government demonstrates this.  

    The ANZTEC agreement is excellent news for New Zealand exporters.  Most dairy products, apples, cherries, wine, lobsters and some others go duty free on entry into force (probably 1 January 2014).  Beef is fully liberalised after 2 years, kiwifruit after 3 years and sheepmeat after 4.  Over 98% of our exports to Taiwan will be duty free after 4 years.  After 8 years 99.5% of exports will be duty free.  After 12 years liquid milk and fresh deer velvet will be duty and quota free and 100% of our exports will be duty free.

    We understand that the agreement will lead to a $600 million plus increase in New Zealand’s GDP.

    The agreement is being considered by the Foreign Affairs, Defence and Trade Select Committee in Parliament. We encourage members to make submissions on it.  Full details of the agreement can be found on

    Taiwan is New Zealand’s 8th largest goods export market.


    There is occasional speculation in the media and blogosphere about a link between the Taiwan negotiation and problems being experienced with China over meat certification. This is totally untrue. ExportNZ understands that while the first problem this year may have been the result of sloppiness on the New Zealand side, the most recent problems seem to be less clear cut. The fact that New Zealand reacted so quickly and that trade has resumed was excellent work by MFAT and MPI. China seems to have a pork glut at present and it is possible that officials are seeking to reduce the flow of competitor meat products while this is being worked through.


    Negotiators are this week in Malaysia progressing the TPP negotiations.  This will be the final round of negotiations before Japan formally enters the negotiation.

    In a related development, Minister Groser was in Washington meeting with his US counterpart to talk about how the TPP negotiation can be brought to conclusion.

    ExportNZ is expecting, given the progress achieved to date, that negotiators should be able to finalise the Chapter texts and general rules for TPP by about the time of the TPP leaders’ meeting, due in October at APEC.  However, negotiations on tariff liberalisation, and on the coverage of the services and investment chapters is likely to continue well into next year.  For New Zealand, this will be the critical part of the negotiation.

    With the US now negotiating an agreement with the EU, it will be important for the US to press for a comprehensive outcome in TPP to serve as a powerful precedent for the EU negotiation.  Any product exclusions under TPP will just play into EU hands.  The US has strong export interest in achieving full liberalisation with Europe in agriculture.


    More bad news has come through this week from the WTO.  While no one is expecting any progress anytime soon on the re-launch of the Doha Round (apart from maybe some Kevin Rudd supporters trying to distract attention away from the stalled Australia-China FTA negotiation), there were high hopes for the negotiations taking place on updating the Information Technology Agreement (ITA).  The original ITA liberalised global trade in computers and computer accessories/components, but since that negotiation in the mid-1990s, a whole range of new products have been developed. The negotiation is designed to capture these new products and ensure that they too can be traded freely by all WTO members.  Unfortunately the meeting this week seems to have ground to a halt.  A major difference between the US and China seems to be the reason.


    We understand that New Zealand negotiators are in Russia trying to progress the FTA negotiation with the Russian-led Customs Union.  We are told that the negotiation remains difficult but that an outcome by the end of the year is still possible.  Don’t expect as clean a deal as that with Taiwan.