Thursday, August 18, 2022

Milk and more: China, New Zealand sign enhanced free trade agreement | International trade news

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Following the US trade war, China signed several trade and investment agreements to strengthen its multilateral credentials.

China and New Zealand signed a deal that enhances their existing free trade pact, giving the Pacific nation’s exports greater access to the world’s second-largest economy.

New Zealand Prime Minister Jacinda Ardern confirmed the signing of an expanded trade deal with China on Tuesday, underscoring its importance amid the coronavirus pandemic.

The deal comes as Beijing seeks to establish itself as a strong supporter of multilateralism in the wake of a deadly trade war with the United States and as the coronavirus keeps international borders closed.

“China remains one of our most important trading partners… The fact that this is happening during the global economic crisis caused by COVID-19 makes it particularly important,” Ardern said at a press conference.

The deal expands an existing trade deal with China and ensures it remains fit for purpose for another 10 years, New Zealand Trade Minister Damien O’Connor said in a statement.

Under the new deal, tariffs on many New Zealand’s predominantly commodity-based exports, which include dairy, timber and seafood, will either be removed or reduced. Compliance costs will also be reduced.

The agreement also includes commitments from both sides to promote environmental protection and not lowered standards to gain a business or investment advantage.

China’s multilateral push

After years of pressure from the administration of former US President Donald Trump on trade and, more recently, international control over the management of the coronavirus, China has emerged as a surprising champion of globalization and multilateralism.

In recent months, Beijing has signed an investment pact with the European Union and joined the world’s largest free trade bloc under the Regional Comprehensive Economic Partnership (RCEP), which also includes New Zealand.

China has also expressed interest in joining the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP), the successor to an earlier pact from which Washington has withdrawn.

Speaking at a virtual meeting of the World Economic Forum on Monday, President Xi Jinping criticized isolationism and “cold war” thinking and called for the removal of barriers to trade, investment and technological exchanges.

As part of its new deal with Wellington, China will also open up sectors such as aviation, education and finance. In return, New Zealand will increase visa quotas for Chinese language teachers and tour guides, state-run Chinese news agency Xinhua reported on Tuesday.

New Zealand was the first developed country to sign a free trade agreement with China in 2008 and has long been touted by Beijing as an example of Western engagement.

Chinese Premier Li Keqiang (left) greeted New Zealand Prime Minister Jacinda Ardern (right) at the Great Hall of the People in Beijing on April 1, 2019 [File: Jason Lee/Reuters]

China is now New Zealand’s largest trading partner, with annual bilateral trade of more than NZ $ 32 billion ($ 21.58 billion).

But the links were tested under Ardern’s government as New Zealand criticized China’s influence on the small Pacific islands and raised human rights concerns about Muslim Uyghurs. Ardern also supported Taiwan’s participation in the World Health Organization (WHO) despite a warning from Beijing.

The trade pact with New Zealand also comes as Beijing’s ties with neighboring Australia deteriorated after Canberra called for an independent investigation into the origins of the coronavirus pandemic, which was first reported. in central China.

Australia has appealed to the World Trade Organization to reconsider China’s decision to impose high tariffs on imports of Australian barley.

New Zealand, which will host the Asia-Pacific regional economic cooperation summit this year, said it would be willing to help negotiate a truce between China and Australia.


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