10th May 2021 By Paul Yandall | firstname.lastname@example.org | @foodtickernz
Kiwi exporters face a turbulent trading environment despite food exporters proving a bright spot, says Damien O’Connor.
And, in what appeared to be a sign of potential tensions with China, the trade and export growth minister urged exporters to be mindful of diversification and to think about their exposure to any single market.
In a trade policy road show speech at Auckland on Thursday, O’Connor said that while businesses faced “challenging and turbulent times” there were opportunities to contribute to New Zealand’s recovery from Covid-19.
“While New Zealand’s trade over the past year has performed better than many initially feared, New Zealand’s two-way trade fell 13% [in 2020], which represents the largest annual fall since data began to be collected in the early 1970s,” he said.
“It is not all bad news, however, and our goods exports were a relative bright spot, with the strong performance of fruit, dairy and some manufacturing such as health technologies.
“Overall, our exports continued to provide much needed support to the New Zealand economy during the worst of Covid-19’s disruption.”
O’Connor said that even before the pandemic, it was not getting any easier to be “a small and distant trade-dependent country”.
“Geostrategic competition between large countries has intensified and protectionism is on the rise with a significant increase in subsidies and new trade barriers globally.”
O’Connor said a strategic priority to support a trade-led recovery wasimproved exporter services.
New Zealand Trade and Enterprise had expanded its services to help more export companies, the Ministry of Foreign Affairs and Trade had published 167 market intelligence reports to help exporters unable to travel.
The government had also established a Maintaining International Air Connectivity scheme, which would run until the end of October, with the possibility of extending to 31 March 2022.
In what appeared to be a warning about China, O’Connor called on exporters to be mindful of diversification and to consider their market concentration and exposure risks.
“As my colleague, minister of foreign affairs Hon Nanaia Mahuta, recently stated, New Zealand must avoid overreliance on any one trading partner,” he said
“It is vital to our long term economic resilience and well-being that we remain agile in the face of changes internationally.”
To that end, New Zealand was continuing negotiations on new free trade agreements (FTAs)with the European Union and the United Kingdom, the country’s third and sixth largest export markets respectively.
“We are also refreshing our agreements with ASEAN trading partners and pursuing our FTA with the Pacific Alliance, a Latin American grouping,” O’Connor said.
“We’re also keeping an eye on options with other regions.”