Exporters dismiss Chogm trade talk
Talk of a free trade agreement (FTA) between Commonwealth countries is a waste of politicians’ breath, the export industry says.
ExportNZ executive director Catherine Beard said a multilateral trade deal between 53 countries was ‘‘too ambitious’’ with ‘‘a lot on the dance card’’ already.
Getting that many countries to agree on one deal would be a ‘‘long, hard, slow slog’’, she said.
The idea of a Commonwealthwide FTA sparked ‘‘excitement’’ among leaders at the Common- wealth heads of government meeting in London at the weekend, according to Foreign Affairs Minister Winston Peters.
Beard said dairy exporters were excited at the prospect of a deal including Africa, a continent they viewed as a growth market.
But international trade discussions should remain focused on deals already on the table with the United Kingdom and the European Union, she said.
Manufacturers’ Network chief executive Dieter Adam agreed, saying that from an economic perspective, the EU FTA should be top of the Government’s priority list, while the UK FTA should be second and a Russia FTA third.
Peters’ previous mentions of a Russian FTA were parked.
Adam said FTAs that removed tariffs for New Zealand exporters were generally positive, but negotiating and signing them took up a lot of diplomatic energy.
At present New Zealand has FTAs with China, Hong Kong, Australia, Malaysia, Singapore, Thailand and Korea.
The Comprehensive and Progressive Agreement for TransPacific Partnership (CPTPP) between New Zealand and 10 other countries including Canada, Japan and Mexico, was signed this year but is yet to come into effect. The deal will save New Zealand exporters an estimated $222 million in tariff payments annually.
New Zealand and the EU formalised FTA negotiations last year, after the UK voted to leave the EU.
National Party trade spokesman Todd McClay said any trade deal that was of high quality was worth considering.
However, New Zealand should be focusing its efforts and limited negotiation resources into deals with the EU, UK and other countries closer to home, he said.
It was also important to consider trading relationships and what New Zealand had to gain.
For example, trade flows with African and Caribbean Commonwealth countries were not significant, and New Zealand was yet to make progress in deals with India, despite having two on the table.
‘‘I think New Zealand is not a country that should say no to a high-quality trade deal, but there are other ones that will deliver much sooner,’’ he said.
Adam felt FTAs paid off for primary-industry exporters, but were ‘‘not really such a big deal’’ for manufacturers.
International tariffs were highest for primary products such as dairy, meat, seafood and timber.
An FTA signed with China in 2008 had been ‘‘significant’’ in reducing the cost to export meat and dairy products, Adam said.
However, New Zealand-made manufacturing equipment was stung with extra compliance costs in countries where its safety standards were not recognised.
Most FTAs did not include mutual recognition of cross-border standards for manufacturing equipment, therefore they were of little value to the industry, he said. ‘‘The devil is in the detail.’’