Free trade exclusions irk industries
NEW ZEALAND’S free trade agreement (FTA) with South Korea has been greeted with qualified support from most, but the thumbs down from the deer and the seafood industries.
The deer industry is dismayed deer velvet has been excluded and describes the agreement as a ‘‘mockery of the term FTA’’.
Seafood New Zealand criticised the deal for excluding frozen squid, which accounts for 28 per cent of seafood trade with South Korea and will continue to suffer a 22 per cent tariff.
By contrast, the dairy, red meat and wine sectors have largely applauded the agreement, signed at the G20 meeting in Brisbane, which could be worth $65 million in cheaper tariffs from the first year.
Beef+Lamb NZ chairman James Parsons said New Zealand was at a disadvantage over the agreement because it started negotiations after competitors such as the United States, Canada and Australia had already signed deals with Seoul.
‘‘We had first-mover advantage over the agreement with China but, with South Korea, other countries got in before us,’’ he said.
Deer Industry New Zealand (Dinz) chief executive Dan Coup said the FTA result was disappointing because the industry had put a lot of effort into building relationships with counterparts in South Korea.
‘‘The reason we’re a bit dumbfounded is that we thought we had done quite a good job and had got people on board to create a win:win for both industries. It makes a mockery of the term FTA,’’ Coup said.
Seafood NZ chief executive Tim Pankhurst said seafood exports to South Korea were worth about $50m a year. There was a two-tier system for fish caught in New Zealand waters.
‘‘If it is from a New Zealandflagged vessel, the catch faces the full effect of tariffs.
‘‘But if the fish is landed in New Zealand from a Korean- flagged charted vessel, it enters the Korean market tariff free, classed as domestic product.’’
The foreign charter vessel legislation introduced this year will require all vessels fishing in New Zealand waters to be New Zealandflagged from 2016.
Meanwhile, Dairy Companies Association chairman Malcolm Bailey largely welcomed the FTA, saying trade with South Korea was worth US$200.5m and exporters currently face import tariffs on dairy of between 8 and 176 per cent. ‘‘It was less than we aspire to. ‘‘But South Korea has a dairy industry which is akin to France’s in that it makes a lot of noise and can be threatening.’’