New Zealand’s food industry has applauded the country’s new fair trade deal with China, the first such agreement between China and a developed country.
China’s Commerce Minister Chen Deming and his New Zealand counterpart Phil Goff signed the agreement in Beijing yesterday (7 April).
New Zealand exports to China that currently face a tariff of 5% or less will become tariff free. New Zealand exports that face a higher tariff will gradually have this cut.
By 2013, 31% of NZ exports to China will be tariff free.
The likes of dairy giant Fonterra are expected to be among the immediate beneficiaries, as the deal will see the elimination of all tariffs on dairy goods.
“From what we have seen it is clear that this deal will be good for Fonterra and for the New Zealand dairy industry. It will significantly improve access for New Zealand exporters, provide certainty in our trading environment going forward, and support Fonterra’s strategy in China,” Fonterra chairman Henry van der Heyden said.
The continued integration of China into the Asian and global economies coupled with the country’s enormous and fast-growing domestic market, has caused Fonterra to identify China as one of the group’s most important emerging markets.
Offering its support to the free trade agreement, Fonterra said that the deal would assist it in further penetrating this potentially lucrative market.