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Free trade warned of PC approach

One News, TV New Zealand

Free trade warned of PC approach

3 July 2006

A lucrative free trade deal with China is hovering on the horizon but some believe the New Zealand government’s politically correct stance may damage business potential relationships.

Government officials have been negotiating a free trade agreement for two years and they are confident they will reach a comprehensive deal with China.

"Certainly over the next five years we will certainly have a much bigger footprint than we’ve got now - we need to have it," says NZTE (New Zealand Trade and Enterprise) North Asia director Merv Stark.

To prove it, the government is spending around $9 million a year on official efforts to promote trade with China and is aiming to expand its presence with more offices in the regions.

But some kiwis involved in business and trade in China, such as Shanghai-based businessman Andrew Grant, are worried that New Zealand’s trade talks with China might stall because the government is trying to influence Chinese policy on issues such as intellectual property and improved working conditions.

"We’re not significant on a global stage and the notion of New Zealand trying to have relevance with China as a whole, I just think is impractical and unrealistic," says Grant.

He says that the government is best to aim for political middle ground.

"My counsel to those involved would be, strike a balance between maintaining our principles but getting a deal done."

But trade officials reject suggestions that its free trade talks are too focused on being politically correct.

"We approach these things with the kind of integrity that we would expect to see in our own country and we’re very confident that that’s the outcome that we’re going to achieve," says NZTE North Asia manager Rod MacKenzie.

Whichever way New Zealand goes about it, attention will need to be paid to strategy. Australia looks set to clinch a free trade deal ahead of New Zealand and there are some suggestions that if kiwi businesses want to cash in on China’s rapid economic expansion, they should focus on the provinces where New Zealand’s entrepreneurial spirit may give them a competitive advantage.

New Zealand’s eighth round of trade negotiations with China are due to take place in a month.