Fran O'Sullivan: Making the most of trade deals

Prime Minister Bill English used the launch of the Government's revamped trade policy to stake out expectations for his meeting with visiting Chinese Premier Li Keqiang.

It is obvious that if New Zealand is to deliver on its top priority in the new trade strategy -- to lift the level of our exported goods covered by free trade agreements to 90 per cent by 2030, from 53 per cent currently - expanding on existing deals like the ground-breaking China-New Zealand free trade deal will be nearly as important as signing new ones.

Officials - from both China and New Zealand - appear to have been more preoccupied than usual with getting the logistics straight for this visit; not just the substantive outcomes which typically, for top level political visits, are well-orchestrated in advance.

The PM told the business audience yesterday morning that there was still some work to do on the detail of the timeframe. That prompted one of the astute former diplomats who dotted the room to indicate that leaders usually like to make that a mutual decision which can be announced in a joint statement and serve as a signal to the respective bureaucracies to get down to work.

English did acknowledge some challenging issues with China. "There are some that are also easily resolved, and what we will be hoping to achieve from the Premier's visit is a pretty accommodating view from the political leadership there.

"And I think we can be optimistic about that."

Judging from the Premier's visit to Australia, which got underway yesterday, Beijing is prepared to deal with outstanding issues. For instance, Li confirmed Australian chilled beef exporters were expected to benefit from upgrades to the China-Australia trade relationship which could also consider changes to non-tariff barriers.

This will give added confidence to exporters on this side of the Tasman, who have experienced difficulties with the chilled beef trade.

The dairy industry will also be more hopeful that their issues with safeguards will ultimately be addressed.

But expansion into the trade in services, e-commerce, and construction will also be in the mix.

The new trade strategy is comprehensive and more layered than when Trade Minister Todd McClay started work on it last year.

When officials initially launched work on the strategy, there was a sense that once governments had finished notching all the trade deals that are on NZ's existing agenda, the focus would shift to trying to eliminate non-tariff barriers (NTBs). Those barriers prevent our exporters from realising the full potential of their exports.

Some $6 billion - according to NZIER reports - still lies on the table as a result of non-tariff barriers.

The Government is budgeting an additional $91.3 million over four years for various efforts to boost trade. There will be two new diplomatic outposts (Ireland and Sri Lanka); a boost to the numbers of qualified people to deal with NTBs; plus a focus on completing new deals.

Thankfully, some hard headed realists ensured an outcome where the two objectives -- opening doors and going through them - could be pursued at the same time.

One issue that the Ministry of Foreign Affairs and Trade - which leads trade negotiations -- has to deal with is the need to create a new generation of world-class trade negotiators.

They are needed to replace globally acknowledged experts like Tim Groser (now NZ's Ambassador to the US) and Crawford Falconer (who occupies the Sir Graeme Harrison chair of trade at Lincoln University). This is an outcome which Mfat - and its Deputy Secretary Trade Negotiations, Vangelis Vitalis - had lobbied for.

English stressed the country's exports had been diversified away from an over-emphasis on dairy, with growth in other sectors such as tourism, wine, information technology and education.

There also needed to be greater intelligence in markets to assist NZ exporters stay agile when regulatory and other shifts occur.

McClay is also appointing a trade advisory group which will include leaders of various business groups, iwi, unions and NGOs.

Yesterday, the business audience was optimistic about the Li visit.

English described a "rather odd situation" where China is proclaiming a policy quite assertively which "we are much more comfortable with than, say, the direction of the US. We think that provides us from the point of view of New Zealand's interests a conducive environment for the FTA upgrade."

The agenda simply said there was an "urgent need for New Zealand to be even more active in seeking to help safeguard that system and secure and sustain access to the overseas markets that we depend on for our prosperity and economic growth." That objective is shared by both New Zealand and China.