Monday, April 7, 2008

New Zealand to be huge Chinese farm?

The free trade agreement signed by New Zealand and China in Beijing today, which was the day's top news item, makes me wonder whether New Zealand will someday be little more than a huge Chinese farm in the South Pacific.

In September 2004, the Green Party of Aotearoa New Zealand opposed a free trade agreement between China and New Zealand for the following reasons:

  • It would lead to further destruction of New Zealand manufacturing capacity and the loss of jobs and firms in secondary production.

  • It is grossly unfair to New Zealand enterprises and workers to be forced to compete with China-based export manufacturers who are heavily government-subsidised and do not meet basic standards of justice and sustainability with regard [to] labour conditions and pay rates, human rights and environmental protection.

  • Further trade liberalisation will exacerbate environmental unsustainability and social inequality, and is not in New Zealand's short-term or long-term interests.

  • It will exacerbate New Zealand's record trade deficit, with China and with the rest of the world.

  • It will establish a preferential trading relationship with a country that refuses to ratify core ILO standards and which abuses the human rights of its own citizens and those of the territories which is has illegally annexed.


    For New Zealand exports to China, the FTA provides for:

  • The elimination, over time, of tariffs on 96 percent of current exports, equal to an annual duty saving of $115 million based on current trade.

  • On entry into force in October, 35 percent of exports to China to be duty-free.

  • Duties on a further 31 percent to be phased out over five years,

  • Remaining Chinese tariffs to be phased out by January 1, 2019.

  • Duties on all but $80 million of current exports, worth nearly $2 billion, to be eliminated by the end of tariff phase-out.

    For Chinese exports to New Zealand, the FTA provides for:

  • The elimination of tariffs on all exports, up from 37 percent now.

  • Over 70 percent to be duty-free within five years.

  • Longer phase-out programmes to apply to sensitive textile, apparel, footwear and carpet sectors.

  • All tariffs to be eliminated by 2016.
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