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China and New Zealand sign free-trade agreement

New Zealand Prime Minister Helen Clark, right, walks with her Chinese counterpart Wen Jiabao as they inspect the honor guard in Beijing yesterday. PHOTO: AFP

New Zealand signed a free-trade agreement (FTA) with China yesterday, the two nations said, making it the first developed economy to enter such a pact with the Asian giant.

New Zealand Prime Minister Helen Clark oversaw the signing of the agreement, which will eventually remove nearly all tariffs between the two nations, arguing the pact will also have positive effects in other areas.

“The FTA ... promotes cooperation in a broad range of economic areas and also provides a platform for further engagement at the governmental, cultural and people-to-people levels,” she said in a statement.

The agreement came after 15 rounds of negotiations stretching back nearly four years and despite some criticism of Clark for pushing ahead with the pact during China’s crackdown on unrest in Tibet.

“It was with a great sense of ambition that we embarked on this particular phase of the relationship,” Clark told her Chinese counterpart Wen Jiabao (溫家寶) in Beijing’s Great Hall of the People.

“This is an historic day for China-New Zealand relations,” Wen said. “The signing and implementation of the China-New Zealand free-trade agreement will ... deliver tangible benefits to both our countries.”

New Zealand has committed itself to abolishing all tariffs imposed on imports from China by January 1, 2016, the Chinese ministry of commerce said on its Web site.

China will scrap tariffs on 97.2 percent of imports from New Zealand by January 1, 2019, the commerce ministry said.

When the deal comes into force, tariffs for 63.6 percent of products imported to New Zealand from China and 24.3 percent of imports into China from New Zealand will be cut to zero, the ministry said.

It did not indicate when the deal will take effect in its statement.

New Zealand Trade Minister Phil Goff, who is traveling with Clark, emphasized the historic nature of the agreement.

“Being the first developed country to sign a comprehensive FTA with China is an enormous achievement for New Zealand,” he said.

“By reducing barriers to trade in goods, services and investment in China, the FTA will give New Zealand businesses a distinct advantage over competitors into that market,” he said.

Two-way trade between the two nations hit NZ$7.54 billion (US$5.94 billion) last year, official estimates from Auckland showed, although the final data have not yet been released.

With the new deal, bilateral trade is expected to grow in the coming years, government officials said.

“Securing preferential access to China’s economy has the potential to deliver significant gains to our exporters,” the New Zealand Ministry of Foreign Affairs and Trade said on its Web site.

“China’s middle class is now estimated to be more than 100 million people and growing — which will fuel the demand for New Zealand’s agricultural products,” it said.

New Zealand has a history of firsts when it comes to economic relations with China. It was the first nation to conclude a bilateral WTO accession agreement with China and the first to recognize its market economy status.

Clark is leading a delegation of 150 representatives to Beijing for the signing ceremony, the New Zealand Press Association said.

Clark has been criticized by some for completing the deal during China’s crackdown in Tibet.
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