Trade deal needed for industry
As the Trans-pacific Partnership Agreement (TPPA) looks less and less likely to go ahead, meat industry executives are still hoping the deal or another trade agreement will level the playing field between countries.
Meat Industry Association chief executive Tim Ritchie said New Zealand needed to be able to access as many international markets as possible.
‘‘Trade is the lifeblood of our industry. We have a very small domestic market, we export 90 per cent of what we produce.’’
Barriers that could impede international trade were tariffs, which free trade agreements tended to neutralise, and non-tariff barriers such as labelling and meat temperature restrictions, he said.
‘‘Why TPP is particularly important is that sometimes another country has a free trade agreement, such as Australia and Japan.’’
The Japan-australia Economic Partnership Agreement came into effect last year.
Under the deal, a 38.5 per cent tariff on beef from Australia would drop to 23.5 per cent for chilled beef within 15 years. The tariff for frozen beef would fall to 19.5 per cent within 18 years. The Australian beef industry is set to receive billions of dollars from the agreement over the next two decades.
Ritchie said the TPPA would have delivered the same reduction in tariffs to ensure New Zealand retained its competitiveness in the beef industry.
If the trade deal were to go ahead it would mean a reduction in tariffs on New Zealand beef going into Japan from 38.5 per cent to nine per cent over the next 16 years, he said.
The tariff would end up being eight per cent for chilled beef and 11 per cent for frozen beef, he said.
The closing of trade borders with countries is a growing concern worldwide and United States President-elect Donald Trump has stated he would withdraw the US from the TPP trade deal on his first day in office.
‘‘Trump was very specific in terms of the election campaign and he’s made his views known but we don’t know what is underneath that,’’ Ritchie said.
New Zealand had been in the business of international trading of meat for 134 years, but protectionism, if it were to happen, would be a major threat to that industry, he said.
New Zealand maintaining its trust and recognition for premium meat products would help it to retain and gain more free trade agreements, whether bilateral or collaboratively with the help of organisations such as the World Trade Organisation, he said.