NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business

Michael Barnett: China chill - are we turning this into something it's not?

By Michael Barnett
NZ Herald·
20 Feb, 2019 03:10 AM5 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

New Zealand Prime Minister Jacinda Ardern meets China's Premier Li Keqiang. Photo / Audrey Young

New Zealand Prime Minister Jacinda Ardern meets China's Premier Li Keqiang. Photo / Audrey Young

COMMENT: There is no getting around the fact that New Zealand has benefited hugely from China's fast paced growth in our tourism, agriculture and services industries over the past 10 years.

The value of our two-way trade with China has more than tripled since the signing of the Free Trade Agreement (FTA) in 2008, China's first FTA – from $8.6 billion in 2007 to more than $27b last year.

The NZ-China FTA was initially projected to increase our exports by between $225-$350 million each year. However, this was rapidly exceeded, with exports increasing by $1b in the first year, and growth continuing.

Read more: NZ on edge of historic fallout with China

Considering that last year, China's economy expanded by just 6.6 per cent, the weakest pace of growth since 1990, isn't it just possible that the drop in the number of tourists and international students coming here has more to do with China's market forces than anything to do with concerns over the relationship with New Zealand? Especially given that the GDP Annual Growth Rate in China averaged 9.55 per cent from 1989 until 2018, including some years annual growth has been above 10 per cent.

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.

Imagine the impact on our spending power if NZ's growth rates slumped by a third in a matter of a year – we would be into belt-tightening and fewer Kiwis would have the luxury to be able to head offshore.

According to the World Bank, between 1990 and 2010 China moved into the ranks of middle-income countries. The extreme poverty rate dropped from 26 per cent in 2007 when NZ signed its FTA with China to 7 per cent in 2012 and then to just 4.1 per cent in 2014.

As with our relationship with other middle-high income countries over the past decades, it is to be expected that as domestic market conditions periodically change – as they did during the Global Financial Crises (GFC) in the early 2000s - there will be fewer tourists and students visiting here.

Advertisement
Advertise with NZME.

Similarly, if we look at current trade trends, there has been a significant reduction in New Zealand log trade with China – exports to that country have almost stopped.

But a quick check suggests it is less to do with claims of a deteriorating relationship with New Zealand and more to do with the fact that China's exports of furniture to the United States have stopped.

Congratulations go to our forestry sector – it has sought to adjust to the down turn in the log trade with China by proactively seeking alternative markets.

Further, there is continuing strong growth in our exports to China of selected dairy and meat products.

Discover more

Energy

Meridian posts record first-half earnings

19 Feb 08:17 PM
Healthcare

Ebos profit drops 4 per cent due to one-off costs

19 Feb 09:08 PM
New Zealand|politics

Spy chief says no Five Eyes pressure on Huawei

19 Feb 09:32 PM
Business

Aussie man loses $100 million in one day

19 Feb 11:07 PM

So, what can we say about the state of the China – New Zealand business trade relationship?

First, the first 10 years of the NZ-China FTA have been extraordinarily successful for New Zealand.

Yes, there are down turns in some areas, but that is far from the whole story and reinforces that we shouldn't rest on our oars, and take the relationship for granted.

As a trading nation, we must double our efforts to not become dependent on any one market – as NZ was dependent on Britain through most of last century until it suddenly abandoned NZ to join the single European Market. Ironically, with Brexit looming, NZ is back chasing an FTA with Britain – but that's another story.

Business has high expectations that a core job of our government is to provide the best platform for businesses to be able to perform – this means providing an enabled domestic environment for doing business and working hard and smart in establishing bilateral and multi-lateral trade arrangements with other countries.

Second, about now would therefore be an ideal time to suggest government encourage a business-led trade mission to China.

Advertisement
Advertise with NZME.

China's economic slowdown to a 6 per cent annual growth rate – more than double what NZ achieves - reinforces commentary that household incomes will continue to rise; there will be a continuing demand in China for quality products of the kind that NZ produces.

But we can't expect that trade to 'just happen' without making a heightened effort to reinforce the value we place on our trading links with China.

It is business, of course, who do the actual business - a truism that doesn't just apply to China but anywhere, and everywhere.

We owe it to ourselves. As an innovative, creative nation we clearly have an unfinished agenda. We have long talked of developing a range of value-added products from our timber, dairy and other primary products.

The forestry sector is exploring the opportunity to increase the domestic processing of logs, and so to is the dairy industry, with A2 milk an example.

Exporting our bulk water, meat, logs and dairy products to China in a raw form makes little use of our higher skilled workforce potential, and the brand we have for producing high value, high quality.

Advertisement
Advertise with NZME.

Maybe now is an opportunity for New Zealand to inject fresh thinking and value into the business relationship with China, and other key trading partnerships too.

I suggest we could be more engaged to show China and the rest of the world the advantages of importing quality – high value processed products.

- Michael Barnett is chief executive of the Auckland Business Chamber.

Save

    Share this article

Latest from Business

Premium
Retail

'Give it a second chance': Ruby's recycled clothing venture takes off

06 Jul 03:00 AM
Premium
Opinion

Opinion: What to do if you have been left out of a parent's will

06 Jul 12:00 AM
New Zealand

26-year-old beats seven finalists to win Young Farmer of the Year

05 Jul 11:41 PM

Audi offers a sporty spin on city driving with the A3 Sportback and S3 Sportback

sponsored
Advertisement
Advertise with NZME.

Latest from Business

Premium
'Give it a second chance': Ruby's recycled clothing venture takes off

'Give it a second chance': Ruby's recycled clothing venture takes off

06 Jul 03:00 AM

Miller-Sharma aiming for 25% of revenue from non-new clothing by 2030.

Premium
Opinion: What to do if you have been left out of a parent's will

Opinion: What to do if you have been left out of a parent's will

06 Jul 12:00 AM
26-year-old beats seven finalists to win Young Farmer of the Year

26-year-old beats seven finalists to win Young Farmer of the Year

05 Jul 11:41 PM
Premium
Trump’s finances were shaky. Then he began to capitalise on his comeback

Trump’s finances were shaky. Then he began to capitalise on his comeback

05 Jul 08:00 PM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP