NZ Enhances ‘World’s Largest’ FTA with China
(26 January 2021 – New Zealand) The New Zealand (NZ) government has inked what is considered the ‘world’s largest free trade agreement (FTA)’ after a protracted period of thirty rounds of negotiations over eight years.
The upgraded deal enables selected NZ goods quicker access to Chinese markets and a declines in tariffs for paper and wood products. The deal was ratified over a year after it was first settled. NZ was the first developed country to sign a FTA with China in 2008 and will now have 98 percent free trade with its largest trading partner once the agreement comes fully into force.
The upgrade has primarily focused on reducing compliance costs for exporters and other measures which ease access to China’s markets. At the Chinese border there will be an expedited six-hour ‘clearance time’ for perishable goods such as seafood. Most dairy products will be tariff-free by 2022 and milk powder by 2024. New Zealand has a trade surplus with China, exporting NZ$19.4 billion in goods and services to the country and importing NZ$13 billion.
“What this does is modernise the free trade agreement that we signed in 2008, brings it up to date. It provides real opportunities for exporters. Ten years ago, some of the issues around trade were not as sophisticated, this agreement allows us to move forward, particularly in the area of services” stated New Zealand Trade Minister Damien O’Connor.