With New Zealand’s bilateral trade with China overtaking that with our long-time trading partner Australia, International Business doctoral researcher Pramuk Perera predicts China will become this country’s most important business partner going forward.
He says that during the decade ended 2012, New Zealand’s bilateral trade with China more than doubled, while trade with Australia grew by only 30 per cent. Further, from January to September 2013, the value of trade between China and New Zealand was over $NZ12.5 billion, $NZ1 billion more than trade with Australia.
Small and remotely located, international trade contributes nearly two thirds of New Zealand’s economic activity. Free-trade agreements (FTAs) play a vital role in this, providing a gateway to foreign markets for New Zealand exporters and investors.
The importance of the FTA with China, which became effective in October 2008, has been well understood at both national and local levels, he says.
“New Zealand Trade and Enterprise conducts China business training courses at the national level. The Dunedin City Council has taken initiatives to connect with China under its ‘linkage beyond our borders’ strategic theme, and ‘Project Shanghai and China’, led by the Otago Chamber of Commerce, specifically focuses on bilateral trade and investment opportunities.”
With a GDP of more than $US8.3 trillion, population exceeding 1.3 billion, expected average growth of seven per cent and high demand for agricultural products, he believes China will be an important strategic partner for New Zealand. However, he also believes that New Zealand should be considering potential benefits from a proposed FTA between Australia and Japan.
Photo: Graham Warman