Groser walks diplomatic path to China as Greens lob barbed warning

National Business Review, New Zealand

Groser walks diplomatic path to China as Greens lob barbed warning

By Liam Baldwin

17 June 2010

A Chinese political and trade delegation to New Zealand has been lauded as a positive continuance of a burgeoning relationship between the two countries by Trade Minister Tim Groser.

In a speech at a lunch to welcome China’s vice president Xi Jinping to New Zealand, along with a Chinese business delegation, Mr Groser said the New Zealand-China free trade agreement was a success story.

“We are increasingly hearing that the 21st Century belongs to China and what could be better than New Zealand being in a trade partnership with a country that will have – and indeed is already having – a major impact on our economic wellbeing and our future prosperity.”

However, just as Mr Groser was delivering his speech in Auckland this afternoon, Green party co-leader Russel Norman has suggested in a veiled statement that the Chinese ministerial visit would have impact on the Overseas Investment Office’s deliberation of a proposal to buy up “sensitive” farm land.

Mr Norman said the vice president’s visit was like to see the OIO put under more pressure over the Crafar farms deal.

Hong Kong-listed company Natural Dairy (NZ) Holdings is backing an application by New Zealand citizen May Wang to buy 16 dairy farms from the beleaguered Crafar family, currently in receivership.

“Improve relations with countries we have, or are seeking free trade deals with, should not in any way be part of the decision making in regard to individual applications,” he said.

However, Mr Groser’s focus was on explaining the importance of China as a trading partner to New Zealand and the benefits that FTA was already having.

“By 2019, tariffs will be eliminated on 96% of New Zealand’s exports to China,” he said.

“The impact will continue as tariffs further reduce and are eliminated.”

As an example, Mr Groser pointed out China’s tariff on New Zealand wine, originally set at 14% was reduced to 5.6% this year and will be zero in 2012. The tariff on kiwifruit has dropped from 20% to 13.3% and will be zero in 2016.

“These reductions not only increase returns to New Zealand growers but clearly provide those sectors with a competitive edge against other exporters to China,” he said.

But the improving freedom in terms of investment continued to worry Mr Norman.

“Labour and National’s support of free trade seems to have infected the decision making ability of our supposed watchdog on overseas investment,” he said.

In a statement, Mr Norman said recent decisions by the OIO showed improved relations with foreign powers being given as a reason for allowing foreign investment in New Zealand.

“New Zealand’s image overseas has also been cited in recent OIO decisions as a reason not to turn down applications.

“New Zealand risks losing control of its economic sovereignty if we lose ownership of large chunks of our primary producing capacity to foreign investors.”

On a more diplomatic path, Mr Groser said China played a major role in sheltering New Zealand from the full impact of a global recession.

“I believe that more and more New Zealanders this and very much appreciate the contribution China is making to our own economy and society.”

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