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Exporters welcome CPTPP as a counter to threat of trade war

Article – BusinessDesk

NZ exporters welcome CPTPP as a counter to threat of trade war sparked by US tariffsNZ exporters welcome CPTPP as a counter to threat of trade war sparked by US tariffs

By Rebecca Howard

March 9 (BusinessDesk) – Industry groups representing a wide swathe of New Zealand’s exports have welcomed the signing of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership as a counter to US moves to protect its industries with import tariffs.

The 11 countries’ combined economies make up 13.5 percent of world gross domestic product – worth US$10 trillion. The US withdrew from the earlier incarnation of the agreement shortly after US President Donald Trump was elected. Fears of a global trade war were stoked after Trump announced plans to impose US tariffs on steel and aluminium imports, prompting China to vow ‘an appropriate response’.

ExportNZ executive director Catherine Beard said in the context of the US protectionist move and the threats of global trade wars, the CPTPP is an exemplar of countries working together for open and free trade.

“One thing the US actions have done is get the rest the world to focus on the benefits of trade, and the CPTPP is a concrete example of everyone moving forward together,” she said.

Alongside the CPTPP, New Zealand signed agreements to exclude compulsory investor-state dispute settlement (ISDS) with Brunei Darussalam, Malaysia, Peru, Vietnam and Australia, the source of 80 percent of investment from the CPTPP nations into New Zealand. A further two countries, Canada and Chile, have joined New Zealand in a declaration that they will use investor-state dispute settlement responsibly.

“This is a fair deal for New Zealand,” Minister for Trade David Parker said in a statement. “It gives our exporters new opportunities in key markets like Japan, it preserves the unique status of the Treaty of Waitangi, and it protects the government’s right to regulate in the public interest.”

New Zealand Winegrowers also said the deal sents the correct signal. “Coming at a time of rising global trade tensions, New Zealand Winegrowers regards the signing of CPTPP as a welcome affirmation that strong, clear global rules on trade are necessary to underpin the standard of living that New Zealanders have come to expect,” it said in a statement.

New Zealand has also joined Canada and Chile in issuing a joint declaration on fostering progressive and inclusive trade.

Mike Chapman, chief executive of Horticulture New Zealand, who is in Chile for the signing, was upbeat about Japan in particular. “For the first time, New Zealand will gain preferential access to Japan, the world’s third-largest economy,” he said. “Kiwifruit from Chile has had the advantage in Japan until now, so this is really good news for New Zealand horticulture.”

“Apple tariffs will also be eliminated over 11 years and this will put us on a level playing field with Australia, which already has preferential access to Japan,” Chapman said. According to Chapman, the deal could add between $1.2 billion and $4 billion to the economy.

Zespri chief executive Dan Mathieson also said most significant benefit for the kiwifruit is in Japan, where New Zealand kiwifruit growers paid over $26 million in tariffs last season. “This tariff relief will means savings for our growers and benefits for Japanese consumers by supporting our competitiveness against other fruit in market,” said Mathieson.

Japan has been one of Zespri’s top markets for volume and value over two decades and annual sales volumes to Japan are expected to increase around 25 percent over the next five years.

(BusinessDesk)

Content Sourced from scoop.co.nz
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