The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will come into force on the 30th December.
While the trade deal covers 11 countries, it also represents New Zealand’s first trade deal with four key markets:
• and Peru.
For each, exporters will have reduced tariffs from day one of the Agreement coming into action, and a second round of tariff cuts for Mexico and Canada in 2019.
New Zealand and JAPAN have a strong relationship, built on substantial trade, economic, tourism and people-to-people links dating back more than 100 years.
Clare Wilson, Regional Director for NZTE in East Asia, says we can expect that relationship to strengthen even further thanks to the improved access the deal will provide exporters to the world’s third largest economy.
Japan will also play host to the 2019 Rugby World Cup, giving New Zealand businesses an added opportunity to promote products, services and capabilities, and expand important networks to an engaged international audience.
The Regional Director for North America, Amanda Martin, says the CPTPP historically marks the first freetrade agreement between New Zealand and our 12th largest export market, Canada.
“The most significant benefits from this are 99% of tariffs on New Zealand’s exports to Canada being eliminated from that date, growing to 99.9% at full implementation that will help in levelling the playing field with competitors. Other benefits include enhanced visa access for business people. These advantages make Canada an even more compelling option now for New Zealand companies looking for a market entry option into North America.”
The meat, wine, fish, wool, leather and textiles and forestry sectors are among the New Zealand sectors to benefit from tariff reductions and elimination to Canada.
Steve Jones is NZTE’s Regional Director for the LATAM region, covering Brazil, Chile, Colombia and Mexico.
Two of these markets – Mexico and Peru – provide particularly exciting opportunities for New Zealand exporters. Dairy, meat, wine and seafood are among the New Zealand sectors to benefit.
Mr Jones says the agreement represents the most significant event in our trading relationship for many years and the impact is immediate.
“One of our customers has reviewed the agreement and reported that it will benefit from tariff reductions from 10% to 15% from 31 December. They’re now working out how to use that additional margin.”
He adds that it is important to note that the benefits of CPTPP are not limited simply to tariff reductions.
“The frameworks that support it provide a formal structure to address other issues such as Technical Barriers to Trade which can sometimes be a bigger obstacle than tariffs to exporters, especially in the LATAM region.”
TECH AND SERVICES
The benefits of CPTPP also extend to exporters who sell services and technology.
“The agreement provides for improved visa access to CPTPP markets for business travellers, mutual recognition of certain professional qualifications, as well as better access to government procurement opportunities across CPTPP markets,” says Richard Cotman, Manager NZ Inc Relationships at NZTE. “This is likely to help New Zealand exporters selling digital, transportation, education and other business services in CPTPP partner countries.”