Sutton delighted at progress towards China talks

The start of negotiations for a trade agreement between China and New Zealand next month will be a big leap forward for New Zealand, Trade Negotiations Minister Jim Sutton said today.

He said there were some real opportunities for New Zealand to be grasped in a free trade agreement with China.

“The joint study, released by Prime Minister Helen Clark and Chinese President Hu Jintao at the APEC meeting in Chile, highlights a potential expansion of New Zealand exports of goods and services to China between 2007 and 2027 are expected to grow between NZ$260 and $400 million a year.

“For China there will be some expansion in exports to New Zealand – potentially between NZ$60 and $100 million a year - but most gains will be achieved by enhanced domestic economic efficiency through increased competition and allocative efficiency within its economy.”

Mr Sutton said the joint study clarified the complementarities that exist between the Chinese and New Zealand economies and does not identify any major problems standing in the way of a free trade agreement.

“The study concludes that an FTA will deliver positive benefits across both economies. However, some sectors in both China and New Zealand might face some adjustment challenges and recommends that these be taken into account in negotiations.”

Mr Sutton said that conclusion was an expected one. The Government has consulted widely with industry, unions, and exporters to identify potential risk areas, and these would be taken into account when setting a mandate for negotiations.

“These negotiations could give us a helping hand into one of the biggest markets in the world. It would be crazy not to start work on making that promise deliver.

“That’s not to say the negotiations are going to be easy. There will, no doubt, be some tough issues, but we will work through them carefully, in consultation with industry and unions. I’m optimistic that in due course we’ll be able to achieve a result that is good for both countries.”

Mr Sutton thanked his colleagues in New Zealand and counterparts in China for all the hard work that had gone into the project so far.

It is expected that the first round of negotiations will be held in Beijing China in the first week of December. There is no set date for when negotiations will be completed.

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