CHINA, NEW ZEALAND TO INK FREE TRADE AGREEMENT IN APRIL

China and New Zealand appear set to sign a free trade agreement (FTA). Although negotiations are not yet complete, both governments reported this week that they have begun preparations for a signing ceremony in April.

Talks over technical requirements and translations of the agreement-the last outstanding issues-should be completed in the coming weeks, according to the Associated Press. The countries began FTA negotiations in July 2004.

New Zealand will be the first developed country to sign a comprehensive trade agreement with China.
The proposed agreement provides for free trade in goods and services, and includes protections for bilateral investment flows. The deal is also likely to include provisions on both education and labour supply, among other issues.

Two way trade between the countries is currently estimated at NZD 4.8 billion ($3.9 billon), with Chinese exports accounting for 80 percent of that total. New Zealand Trade Minister Phil Goff predicted that the deal "will boost New Zealand's exports of goods and services to China by up to 400 million New Zealand dollars ($326 million) a year," reports AP.

"This FTA has been negotiated with the overriding objective of opening up economic opportunities for New Zealand business in China and to boost commercial ties with our now third largest trading partner," Goff said.

The AP report also cited New Zealand Prime Minister Helen Clark saying that the deal would mean big things for New Zealand farm products. According to the Prime Minister, the most important aspect of the agreement is the elimination of tariffs in New Zealand exports, which will allow for more access to the Chinese market. "China has very open access to our market now. The key breakthrough in this agreement with China will be us getting some reciprocity because we do face quite significant tariffs on key exports," she told reporters.

After details of the agreement are completed, it will have to be ratified by both the Chinese and the New Zealand Legislatures.

The signing ceremony is tentatively planned for 6-9 April in Beijing.

ICTSD reporting; "NZ, China Free Trade Deal in April" ASSOCIATED PRESS, 26 February 2008; "New Zealand to sign Free Trade Agreement with China in April" ECONOMIC TIMES, 26 February 2008.