-
Watch Video
-
Related
New Zealand has signed a 12-country free trade agreement, forging ahead with improved trade relations in an economic climate that has seen some economies nurture protectionism.
Trade Minister Tim Groser signed the ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) agreement on Friday at an official signing ceremony in Hua Hin, Thailand.
Groser says the agreement is of economic and strategic importance for New Zealand, and one which is expected to gradually eliminate trade barriers, reduce transaction costs, and provide greater certainty and transparency around trade.
"It also sends the message that Australia, New Zealand and the members of ASEAN believe that continued regional economic integration, not protectionism, is the best way to bring us through the most serious international economic crisis we have faced since the Great Depression," says Groser.
The Association of Southeast Asian Nations (ASEAN) signatories are Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam, Lao PDR, Myanmar and Cambodia.
As a whole ASEAN makes up New Zealand's third largest export market and in 2008 was worth $4.6 billion.
It has also been a high growth market for New Zealand, growing 121% since 2000.
Globally, ASEAN represents a market of more than 566 million people and accounts for more than US$1,400 billion in trade.
Groser says the agreement will, over time, make 99% of New Zealand's exports to Indonesia, Malaysia, the Philippines and Vietnam duty free.
Federated Farmers has welcomed the agreement, saying it represents a "massive opportunity" for New Zealand's farmers.
The organisation says New Zealand is well positioned geographically to take advantage of the fast growth ASEAN economies, rather than focusing all its attention on established markets such as the United States and Europe.
"This century will be the Asia-Pacific Century and New Zealand is in the right part of the world, exporting the right goods at the right time," says Federated Farmers president Don Nicolson.
The AANZFTA signing has been part of a larger tour in the Asian region for Groser, who is also progressing trade discussions with India.
On Sunday, both countries agreed to begin free trade negotiations.
At the moment New Zealand's exports to India are worth around $US350 million a year, but experts say this figure could double under an FTA.
Farmers would be one of the first sectors to benefit.
"If all FTA's come to fruition, it will mean direct and indirect agreements with the four most populous nations on earth being China, India, the United States and Indonesia. That's almost half of the planet's population and much of the world's economic activity," says Nicolson.
Federated Farmers says New Zealand's trump card is its ability to produce high quality food more efficiently than many other countries in the world.
Groser says the AANZFTA agreement is yet to go through the parliamentary examination process, but he hopes that it may come into force as early as 1 July this year.
AANZFTA is the latest free trade agreement New Zealand has entered following the China-New Zealand agreement that came into force last October.
That agreement is estimated to be worth $280 million a year.
To find out more about the AANZFTA agreement, CLICK here .
