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Prime Minister Key announced new three-year multi-entry visa provisions following bilateral talks with new Chinese Premier Li Keqiang in Beijing earlier this month.
The new visas will apply from 1 July this year. They mean China will be able to issue New Zealand business visitors with a three-year multi-entry visa, enabling them to make multiple visits over a three year period, with the proviso that any individual stay can only be up to 30 days per visit.
A standardised fee will apply to these three-year multi-entry business visas, replacing the current system under which China charges a graduated fee for multi-entry visas depending on their duration.
New Zealand will be able to issue Chinese business visitors, who otherwise meet normal immigration requirements, with three-year multiple entry visas that will enable them to spend a maximum total of 90 days in New Zealand in any 12-month period over the course of the three years.
The new visas mean that business people from both countries will not need to apply for visas as frequently. This will lower the cost of travel for business travellers, make it easier for business people to travel and in turn, strengthen business connections between our two countries.
These new visa arrangements were negotiated by respective government agencies within the context of the Committee on the Movement of Natural Persons established under the China NZ Free trade Agreement (FTA). They are a good example of how the FTA institutional frameworks can be leveraged to generate practical outcomes of interest to business on both sides.
Japan has been welcomed into the TPP negotiation by the existing 11 participants.
TPP ministers met in the margins of the APEC Trade Ministers’ Meeting in Surabaya, Indonesia and extended the invitation to Japan to join in the negotiation. On 21 April, Trade Minister Tim Groser made this announcement in a press release on behalf of the existing TPP membership.
“The existing TPP members particularly welcomed Japan’s commitment to achieving the shared goal of a comprehensive, high-ambition, next-generation agreement as rapidly as possible, consistent with the statements made by TPP Leaders and Trade Ministers on 12 November 2011 in Honolulu. We look forward to working with Japan as we seek to conclude a comprehensive and balanced package, taking into account the diversity of our levels of development”.
Japan formally announced its interest in joining in the TPP negotiation on 15 March 2013. Since then bilateral and collective consultations have taken place between Japan and the existing TPP members. New Zealand completed its bilateral consultations with Japan on 19 April.
Japan will be the second largest participant involved in the TPP adding nearly US$6 trillion to the combined TPP GDP. Japan is New Zealand’s fourth largest individual trading partner. In the year to December 2012 two-way trade stood at NZ$6.2 billion. New Zealand exports to Japan were NZ$3.2 billion, accounting for 7 per cent of total exports.
TPP members, where applicable, will now complete their domestic procedures required to confirm Japan’s participation in TPP. For New Zealand, no further steps are required. Once those processes are complete, Japan will be able to formally participate in the negotiations.
The next round of TPP negotiations will be held in Lima, Peru from 15 – 24 May. Stakeholders can register to attend the stakeholder events in Lima up until 30 April. For registration details please visit www.mfat.govt.nz/tpptalk.
For further information, please contact the TPP team at tpp@mfat.govt.nz.
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As part of the Government’s focus on strengthening bilateral relations and trade opportunities with Latin America, Prime Minister John Key led a delegation to Mexico, Colombia, Chile and Brazil from 3-12 March.
The delegation included Minister for Primary Industries Nathan Guy and 23 business representatives from New Zealand businesses with interests in Latin America, including Zespri, Fonterra, Air New Zealand, niche agribusiness companies, and representatives from the education and technology sectors.
Latin America is one of the fastest-growing and most dynamic regions in the world, and the visit demonstrated that Mexico, Colombia, Chile and Brazil are countries where New Zealand’s skills and expertise are a natural fit. While Latin America will continue to offer opportunities for sales of certain New Zealand commodities, the big opportunity for New Zealand is investment in the agriculture sector and in high-end technology manufacturing and services. There is scope for New Zealand agribusiness to support productivity improvement in all of these countries, and to position ourselves as a strategic partner for Latin America as it continues to lift its populations into middle class, and as its producers focus on meeting the food demands of the Asia-Pacific region.
The Prime Minister’s visit to Latin America was particularly well-timed to prepare New Zealand businesses for the new opportunities that will arise with the successful conclusion of the Trans Pacific Partnership (TPP). The TPP will establish a free trade relationship with Mexico for the first time and will greatly improve New Zealand’s ability to conduct business with existing FTA partner Chile.
One of the significant announcements of the visit was the agreement with Colombia to conduct a strategic assessment of a comprehensive economic partnership between the two countries. President Santos said that Colombia wanted to negotiate a Free Trade Agreement with New Zealand and was ready to move this forward “when New Zealand is ready to do so.”
With strong economic growth, Colombia is poised to become the third largest economy in the region. The value of a potential Colombia-New Zealand FTA is primarily strategic with a view to meeting growing demand for agricultural products in the Asia Pacific region. A strategic partnership with New Zealand, via the negotiation of an FTA, would enable New Zealand investment and expertise to unlock the productivity of Colombia’s agriculture sector. There is considerable potential in Colombia, with an under-developed agriculture sector, large areas of arable land and forestry becoming available thanks to an improving security situation. In particular, Colombia holds the promise of becoming a significant and more efficient producer of dairy.
The Prime Minister and Minister Guy advanced a number of other specific initiatives during the Mission to strengthen the trade and economic relationship. These included:
The other big story of the visit was education. New Zealand is already seen as a destination of choice for Latin America, and the signing of further agreements with Brazil and Chile will facilitate increasing links in this area, including internships for PhD students with New Zealand businesses. There is scope for New Zealand to provide a variety of education services to Latin America, including vocational training, exporting the New Zealand ITO training model, English language training and professional development for teachers and trainers, especially in Brazil as it gears up to host the FIFA World Cup in 2014 and the Olympics in 2016. A delegation from Colombia will visit New Zealand in late May for education meetings and to study the New Zealand model of vocational training first hand.
The visit successfully opened doors for the accompanying business delegation and has already delivered tangible outcomes. Business representatives met with industry counterparts in each country – resulting in 49 business leads, and the establishment of a number of new contacts and relationships which will provide the foundation for future business partnerships.
For further information, contact Halia Haddad (439 8446).
The General Administration of China Customs (China Customs) and the NZ Customs Service have announced a trial of new procedures that will allow for the clearing of New Zealand goods held in bonded storage (Special Customs Control Areas and Bonded Places) when they reach China and then released in parts into the domestic market.
The pilot will trial the “multiple use” of a Certificate of Origin to clear goods under the China-NZ FTA when goods are declared in part for domestic consumptionimporters in China will receive the same lower preferential tariff rate for the entire shipment regardless of multiple parts of the shipment being released into the domestic Chinese market.
The 12-month trial will commence during the second half of 2013 and cover both air and sea freight arriving at the six ports of Guangzhou, Nanjing, Qingdao, Shenzhen, Shanghai and Tianjin. It will cover all most all goods eligible for tariff preference under the FTA.
The new procedures will be made available on the China Customs website www.customs.gov.cn, the New Zealand Customs website www.customs.govt.nz and the China New Zealand Free Trade Agreement website www.chinafta.govt.nz prior to the commencement of the pilot
Goods exported from all Chinese ports to New Zealand that qualify as Chinese origin will be granted the FTA preferential rate of duty.
The Ministry of Foreign Affairs and Trade is planning to hold a further series of TPP stakeholder sessions in major centres from June to August.
Stakeholders will be able to hear a first-hand update from New Zealand’s Chief Negotiator on progress in key areas of the negotiation as we work towards conclusion of an agreement this year. Officials also plan to hold further dedicated meetings on intellectual property and health-related issues in the negotiation.
Dates and venues have yet to be confirmed but we would welcome expressions of interest to attend a stakeholder session or requests for an individual meeting to tpp@mfat.govt.nz. Please note your specific area of interest in your email to the team.
We also welcome continued input from exporters and New Zealand firms operating offshore as negotiations to develop commercially meaningful market access packages across goods, services, temporary entry for business people, investment and government procurement intensify.
Details on the following types of barriers that affect your business continues to be our best source of information for informing New Zealand’s approach in TPP market access negotiations:
Following the 21 April announcement that Japan will join negotiations once applicable domestic legal procedures across the TPP membership are complete, we are particularly interested to hear from exporters and investors that have an interest in the Japanese market, including any updates to issues already highlighted in the December 2011 submission process.
TPP enquiries can be directed to the TPP team at tpp@mfat.govt.nz. Regular updates on the negotiation continue to be posted on the Ministry’s TPP Talk website at www.mfat.govt.nz/tpptalk.
In recent months New Zealand and 21 other WTO members* have been exploring the possibility of launching negotiations on a new trade in services agreement – known as the Trade in Services Agreement (TISA).
This initiative provides New Zealand with an opportunity to advance our on-going efforts to lower trade barriers for New Zealand services exporters at the WTO and through free trade agreements. Through negotiations, New Zealand stands to benefit from securing improved market access to TISA markets, which account for approximately 80 per cent of New Zealand’s commercial services exports. Total New Zealand services exports were $13.7 billion in 2012.
Negotiators met early this month to discuss next steps in developing a high quality framework that builds on existing WTO rules and market access (the General Agreement on Trade in Services, or GATS), and can attract broad participation from the wider WTO membership.
We are eager to hear from services exporters and investors about how we can lower barriers to services trade and make it easier to do business in TISA markets. Examples of the common sorts of restrictions that New Zealand service suppliers typically face offshore include:
As part of this request for feedback, the Ministry will shortly call for Submissions from stakeholders on this website.
Please send any questions or information on barriers to services trade in TISA markets, ideally by 10 June 2013, to Vickie Miller, Trade Negotiations Division at, vickie.miller@mfat.govt.nz.
* Australia, Canada, Chile, Chinese Taipei, Colombia, Costa Rica, the European Union (comprising 27 member states), Hong Kong, Iceland, Israel, Japan, Korea, Mexico, Norway, Pakistan, Panama, Paraguay, Peru, Switzerland, Turkey, and the United States.
Global value chains (or GVCs) refer to different stages of production taking place in different countries – from design, manufacture and assembly, to sales and service. An iPod designed in the United States, with parts manufactured across Asia, is assembled in China and sold in Australia, for example. GVCs have grown rapidly over the last decade as technology, lower trade and investment barriers, and lower transportation costs have made it easier for companies to shift activities and tasks offshore. It is changing the way everyone needs to think about the flow of exports and imports globally.
The OECD WTO Trade in Value Added database was released in January 2013. It reveals several key findings. One is that imports are often crucial in firms’ production for export. So taxing imports increases the costs of producing for export. Other findings include that: trade protection and other border costs are compounded as parts and components cross borders many times; SMEs can play important roles in GVCs by contributing indirectly to the exports of larger firms and; services are also a significant component of exported goods.
New Zealand is generally not well connected into GVCs. We’re a long way from sources of imported inputs and from our export markets. Still, about a third of our imported inputs are used in production that is then exported. In the agriculture and food sectors, few imported intermediaries are used but a large share - about half - are used in manufacturing that is then exported. Our exports, particularly agriculture and food, also feed into production in other countries.
GVCs provide new opportunities for services to be traded across borders, and can increase the markets for niche goods. GVCs are often regional in nature, with Asia a significant hub. New Zealand has great potential to connect into this through our network of FTA and business connections.
GVCs will be discussed at the OECD Ministerial meeting on 29 – 30 May, attended by Minister Groser. More detail on the OECD’s analysis of GVCs and international trade in “value-added” terms is available at www.oecd.org/industry/ind/measuringtradeinvalue-addedanoecd-wtojointinitiative.htm.
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