New Zealand Prime Minister Jacinda Ardern has a meeting with Chinese Prime Minister Li Keqiang at the Great Hall of the People in Beijing, China, April 1, 2019.
Naohiko Hatta | Billiards | Kyodo News | Getty Images
China and New Zealand on Tuesday signed an agreement to update their existing free trade pact, which will give exports of goods from the Pacific nation increased access to the world’s second-largest economy.
New Zealand Prime Minister Jacinda Ardern confirmed the signing of the agreement at a news conference on Tuesday, citing the significance of the agreement amid a crippling pandemic and a global economic crisis.
The pact has been under discussion for years and was concluded in November 2019, but was awaiting China’s official signing.
New Zealand Commerce Minister Damien O’Connor signed the modernized agreement in Wellington through a “virtual signing ceremony” with Chinese Commerce Minister Wang Wentao in Beijing.
New Zealand said the agreement “modernizes” the existing free trade agreement with China and ensures that it remains fit for purpose for another decade.
It facilitates exports to China and is expected to reduce compliance costs for New Zealand exports by millions of dollars each year.
The upgrade will also mean that 99% of New Zealand’s nearly $ 3 billion ($ 2.16 billion) trade in wood and paper to China will receive duty-free access, O’Connor said in a statement. .
The agreement will benefit New Zealand exporters of perishable goods such as seafood, forestry and other primary industries.
The existing conditions for dairy products have been maintained, with all safeguard tariffs being phased out within one year for most products and three years for milk powder.
“This means that by January 1, 2024, all dairy exports from New Zealand to China will be duty-free,” O’Connor said.
New Zealand was the first developed country to sign a free trade agreement with China in 2008, which was long promoted by Beijing as an example of the first with Western countries.
China is now New Zealand’s largest trading partner, with annual bidirectional transactions of over $ 32 billion ($ 21.58 billion).
But the ties were tested under Ardern’s rule, while New Zealand criticized China’s influence over the small Pacific islands and raised human rights concerns about Muslim Uighurs in Xinjiang. Ardern also supported Taiwan’s participation in the World Health Organization (WHO), despite the Beijing warning.
The trade pact with New Zealand also comes as Beijing’s ties with neighboring Australia have worsened after Canberra called for an independent investigation into the origins of the coronavirus pandemic, which was first reported in central China.
Australia has called on the World Trade Organization to review China’s decision to impose heavy tariffs on Australian barley imports.
New Zealand, which will host the Asia-Pacific regional economic cooperation summit this year, said it would be willing to help negotiate an armistice between China and Australia.