Trade update – May
United Kingdom-New Zealand FTA
The international treaty examination process has been completed by the Foreign Affairs, Defence, and Trade Select Committee, and they have released their final report. The Agreement will now move into the legislation phase and will go through the House as a Bill. The FTA is still on track to be ratified and come into force before the end of the year.
ExportNZ will work with the Ministry of Foreign Affairs and Trade and New Zealand Trade and Enterprise on a UK-NZ FTA outreach programme.
European Union-New Zealand Free Trade Agreement
The last formal round concluded in March this year, with no further rounds planned that we know of. Officials are looking to conclude the agreement by the end of the year, but that will depend on NZ getting a high quality goods access offer which we think has yet to materialise, issues around Geographic Indicators also continue.
Comprehensive & Progressive Trans-Pacific Partnership
The UK accession to the CPTPP is progressing, negotiations are currently centred around market access.
China, Taiwan, and Ecuador’s applications are yet to move forward. South Korea continues to signal an interest in joining the Partnership.
New Zealand has initiated dispute settlement proceedings against Canada regarding its implementation of dairy tariff rate quotas (TRQs) under the CPTPP. Canada’s dairy market is highly protected with tariffs on some dairy products as high as 300 per cent. The New Zealand government has estimated the lost market access to have cost dairy exporters approx.. $68 million over the past two years. The implementation of these TRQs is inconsistent with Canada’s obligations under the CPTPP.
Catherine Beard gave a comprehensive overview of the dispute settlement proceedings and why New Zealand has laid the complaint, you can listen here.
Digital Economic Partnership Agreement
New Zealand is keen to see more parties join the agreement. South Korea and China have signalled their interest, and Canada is also considering joining.
Indo-Pacific Economic Framework (IPEF)
ExportNZ is keeping a watching brief over the US-led initiative – IPEF.
The IPEF will include four pillars: Fair and resilient trade, Supply chain resilience, Infrastructure and decarbonization, and Tax and anti-corruption.
While New Zealand will be enthusiastic that the US is engaging the region in fair and resilient trade, the US has taken goods market access and tariff reductions off the table, which ExportNZ is not happy about. Our preference would be to have the USA join CPTPP, but that seems to be unlikely under the current Administration.
India-New Zealand Trade Relations
Following the signing of the Australia-India Comprehensive Economic Cooperation and Trade Agreement, there is no update on a similar bilateral agreement between New Zealand and India.
India is seriously considering joining the US-led Indo-Pacific Economic Framework, which New Zealand will look to be a part of.
India also has the option to fast-track accession back into the Regional Comprehensive Economic Partnership (RCEP).