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In a world first for any developed country, New Zealand entered into a free trade agreement with China in 2008, and with it came a unique competitive advantage. The free trade agreement is a success story for both countries. It has opened up significant trade and economic opportunities and has been a catalyst for closer cooperation across a number of areas.
New Zealand goods exports to China have quadrupled since the free trade agreement was signed and entered into force in 2008. China is now New Zealand’s largest trading partner, with two-way trade valued at over NZ$28 billion in 2018. China is also New Zealand’s second largest and fastest growing tourism market, largest source of international students, and a significant source of foreign investment.
Highlights of the original free trade agreement include:
- Tariffs are now eliminated for over 97% of New Zealand goods exports to China. In 2018, all exports other than dairy (some products remain subject to tariffs and safeguards that will be phased out by 2024), and a small number of products that were excluded from the FTA are eligible for tariff-free access into China.
- Better access to high quality Chinese goods for New Zealand businesses and consumers. In 2018, all imports from China are eligible for tariff-free access.
- Improved access to Chinese markets for New Zealand service providers, including future-proofing rules that ensure service exporters in some sectors will benefit from any improved access that China grants to other FTA partners.
- Faster and easier temporary entry to China for business people through improved visa processing.
- Greater cooperation in areas such as sanitary and phytosanitary measures and technical barriers to trade.
- A clear process for settling disputes related to the FTA.
- Dedicated agreements on environment and labour that provide for more effective discussion and cooperation.
- Reduced red tape, including an easier and less costly route for New Zealand exporters of certain electrical and electronic equipment products to comply with Chinese certification requirements.
Figures used are for the year ended June 2018.