New Zealand eyes FTA with S. Korea this year
Xinhua 2012-03-26
New Zealand eyes FTA with S. Korea this year
New Zealand Prime Minister John Key would like to see a free trade agreement (FTA) with South Korea agreed this year in order to bolster bilateral trade links, despite admitting Monday that some South Korean industries would resist a deal.
New Zealand Prime Minister John Key would like to see a free trade agreement (FTA) with South Korea agreed this year in order to bolster bilateral trade links, despite admitting Monday that some South Korean industries would resist a deal.
Key told the Kiwi Chamber in Seoul that concluding an FTA in the Year of Friendship to mark 50 years of diplomatic ties would be "a great testament to our bonds, and it would create business and economic links that would drive growth and innovation."
Key, who is in Seoul for the two-day Nuclear Security Summit beginning Monday, said New Zealand would work with South Korean and other regional partners to build open and inclusive dialogue and cooperative programs to advance Asia-Pacific economic growth and security.
New Zealand and South Korea were also close to concluding an Antarctic Cooperation agreement and a defence-related Information Sharing Agreement, Key said in a speech published Monday.
Two-way trade had reached 3 billion NZ dollars (2.45 billion U. S. dollars) a year and continued to grow, said Key.
"Korea is now our fifth-largest trading partner and remains New Zealand’s second-largest source of international students and seventh-largest source of tourists. More than 50,000 Koreans visited New Zealand last year."
New Zealand businesses in the food and beverages sector and advanced technology were breaking into the Korean market, but New Zealand exporters could do better, he said.
"The share of imports into each other’s market is slipping relative to each of our key competitors. To put it more simply, trade between our two countries is simply not growing as fast as our trade with other countries."
New Zealand’s imports from countries with which it already had FTAs, such as China and the 10 ASEAN countries, were growing much faster than imports from Korea.
"And while our exports to Korea are growing, our share of Korea ’s imports has roughly halved since 2000," he said.
"As New Zealand and Korea negotiate FTAs with a wider range of countries, this trend is only going to accelerate."
Key said he wanted to see Korean companies enjoying the same level of access to New Zealand’s market as some of its neighbours.
"And I would also expect that, in this Year of Friendship, Korea would want to ensure that New Zealand exporters were not discriminated against relative to our competitors, including those from the United States and Europe," said Key.
"It would make doing business easier and enhance flows of people and investment between our two countries. And it would ensure that, as we continue to reduce tariffs for other countries with which we have FTAs, our exporters will not be edged out of each other’s markets."
A New Zealand-Korea FTA would also enhance both New Zealand and South Korea’s capacity to supply safe, healthy food in a cost- effective and competitive way.
"Our exporters supply high-quality food ingredients to Korean companies that are in the engine room of Korea’s drive to boost its high value food exports," said Key.
"An FTA with New Zealand will build the business links that will give Korean manufacturers secure and reliable access to products they want and need.
"It’s also a fact that stronger commercial links will lead to commercialization of our science and technology collaboration."
However, Key also told Radio New Zealand Monday that South Korean farmers were putting up much resistance to free trade deals, but good headway was being made.
"There’s definitely a willingness on the Korean side to complete a deal. There’s a lot of interest, obviously, on our side, " Key told Radio New Zealand.
"The worrying thing up here is that, without an FTA, companies like (kiwfruit marketer) Zespri and (dairy cooperative) Fonterra could effectively be locked out of this market."
Key said tariffs paid by New Zealand exporters were high and the lack of an FTA was a huge competitive disadvantage.
