Global Economic and Trade Update for New Zealand Businesses - 1 October 2021

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We welcome feedback from New Zealand exporters on this report and invite requests for reporting from New Zealand’s network of Embassies and High Commissions(external link). If you would like to be added to the weekly distribution list for this report, please also email us at exports@mfat.net.

Domestic Updates

  • On 27 September, the Government announced a self-isolation pilot that will open in October for New Zealand-based business people going on short term travel overseas. Interested applicants will need to demonstrate that they satisfy the following criteria: New Zealand citizens or residents with a right to re-enter New Zealand; travelling overseas on a short business trip, and not travelling to or through very high-risk countries, fully vaccinated with Pfizer in New Zealand; and willing to self-isolate for 14-days on return to New Zealand in Christchurch or Auckland. Expressions of interest are open for applications from 9:00am Thursday 30 September until 5:00pm Saturday 9 October. Further information can be found here(external link).
  • On 27 September, Cabinet agreed that one-way quarantine-free travel for RSE workers could commence from 4 October from Vanuatu, and from 12 October from Samoa and Tonga.  This decision was made on the basis that key conditions around establishing formal arrangements and ensuring health, border and operational readiness have been, or will be met by these dates. This one-way quarantine-free travel pilot period for RSE workers only will be used to ‘road test’ arrangements with a controlled group to ensure safe implementation. There will be a review one month after commencement, including consideration of expansion to other traveller categories from the participating countries.

Global & Multilateral Updates

  • The World Trade Organisation (WTO) Public Forum 2021(external link) will take place from 28 September – 1 October on the topic of ‘Trade Beyond COVID-19: Building Resilience.’ It will consider the impact of COVID-19 on trade and how the multilateral trading system can help build resilience to the pandemic and future crises. The Public Forum is the WTO’s largest annual outreach event and aims to provide a platform for participants to discuss the latest developments in world trade and to propose ways of enhancing the multilateral trading system.
  • The Asia-Pacific Economic Cooperation (APEC) Women and the Economy Forum was held on 24 September. Chaired by Minister for Women Jan Tinetti, with New Zealand represented by Minister Priyanca Radhakrishnan, the meeting focused on women’s economic empowerment and its role in the Covid-19 Recovery. It included key note remarks from Helen Clark, as well as remarks from ABAC Chair Rachel Taulelei, and a policy dialogue on “Women’s Economic Empowerment Post Covid-19.”
  • The sixth round of the Agreement on Climate Change, Trade and Sustainability (ACCTS) negotiations ended on 21 September.  There was steady progress made in each of the four working groups on the liberalisation of environmental goods, new and binding commitments on environmental services, disciplines for fossil fuel subsidies and guidelines to inform the development and implementation of voluntary eco-labelling programmes.  The consensus environmental goods list continues to expand. Further information on ACCTS can be found on our website: ACCTS | New Zealand Ministry of Foreign Affairs and Trade (mfat.govt.nz).

Regional Updates

Australia and the Pacific

  • Tonga’s border closure and economic and social stimulus support has encouraged households to become more self-sufficient through the extensive planting of crops. King Tupou VI continues to advocate for Tongans to return to planting their own food to mitigate against food supply shortages. This has seen an abundance of fresh crops being sold in the local markets. Government has also subsidised domestic supplies of seafood and those commercially fishing in Tonga’s water are required to provide low cost fish to the local market as part of their licensing.  Government has instituted monetary policy decisions to mitigate against inflationary pressure, namely exempting consumption tax, excise tax and customs duty from all imports of food items and personal consumer goods not for commercial purposes, and from construction goods for tourism purposes.

Asia

  • According to forecasts by the Economist Intelligence Unit, tourism spending in Thailand will not reach pre-pandemic levels until at least 2023. Conversely, the other major engine room of the Thai economy – the export sector – has begun to recover. With steady international demand from major markets such as China and the US, and with most of last year’s supply chain issues resolved, many exporters are doing better than ever. The Bank of Thailand has raised export growth projections for 2021 to an 11-year high of 17.1%, fuelled largely by demand for computer equipment, motor vehicles, and agricultural products. While domestic retail spending continues to be subdued overall, the pandemic has accelerated a transition towards online shopping in Thailand, with significant potential for further growth given Thailand’s high internet penetration rate of 91%.
  • New Zealand goods exports to Thailand from January to June 2021 have held up relatively well (fuelled by dairy: total goods export value was higher from January-July 2021 than the first six months of 2019). With COVID spurring demand for products seen as healthy, safe and quality, there is significant opportunity for New Zealand products in Thailand. There are, however, ongoing challenges with freight – particularly airfreight, which has been both expensive and challenging following the cancellation of the Thai Airways Auckland-Bangkok direct flight.

Europe

  • Trade and Export Growth Minister Damien O’Connor will travel to Europe in early October to advance New Zealand’s trade and economic interests with key partners, including representing New Zealand at the G20 Trade Ministers’ Meeting in Italy. The Minister’s travel follows recent engagement between Prime Minister Jacinda Ardern and the President of the European Commission Ursula von der Leyen to progress a free trade agreement with the European Union (EU-NZ FTA). As New Zealand’s fourth largest trading partner with two-way goods and services trade at over NZ$15 billion per year, securing a high-quality and comprehensive EU-NZ FTA is a Government priority. Minister O’Connor’s visit to Europe includes stops in Sweden, France, Ireland and Italy where he will meet with Ministerial counterparts to discuss the EU-NZ FTA and the benefits of closer co-operation. The Minister will also meet with his EU counterpart in Brussels, European Commission Executive Vice-President and Trade Commissioner Valdis Dombrovskis, to reinforce New Zealand’s expectations and commitment to swiftly conclude the negotiation of a commercially meaningful agreement. Minister O’Connor will also be travelling in his capacity as Agriculture Minister. Further information about the trip can be found here(external link).

Market reports released this week

  • The previous global economic and trade update can be found here.
  • A new report on Expo 2020 Dubai, prepared by MFAT’s Middle East and Africa Division, New Zealand’s Embassy in Abu Dhabi and the New Zealand at Expo team in Dubai has been published.
  • A new report about the German fruit and vegetable market was prepared by the New Zealand Embassy in Berlin

External links

The following links may provide useful information to businesses:

  • NZTE(external link) has a website focused on providing COVID-19 information for exporters. They’ve also launched myNZTE(external link), an interactive digital portal of insights and tools available to all New Zealand exporters.
  • The Treasury releases a weekly economic update(external link) every Friday. Stats NZ has published a data portal(external link) with near real-time economic indicators.
  • MBIE publishes a sector reports series(external link) which provides regularly updated reports on all industry sectors that make up the New Zealand economy. These include official economic data and the challenges and opportunities that face New Zealand’s industry sectors.
  • govt.nz(external link) provides tools and advice from across government to save small businesses’ time and help make the business a success.
  • MFAT has created a tariff finder(external link) which is designed to help goods exporters and importers maximise benefits from New Zealand’s Free Trade Agreements and compare tariffs in 136 other markets.

To contact our Export Helpdesk

Disclaimer

This information released in this report aligns with the provisions of the Official Information Act 1982. The opinions and analysis expressed in this report are the author’s own and do not necessarily reflect the views or official policy position of the New Zealand Government. The Ministry of Foreign Affairs and Trade and the New Zealand Government take no responsibility for the accuracy of this report.

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