Aotearoa New Zealand has ratified the Regional Comprehensive Economic Partnership (RCEP), Minister of State for Trade and Export Growth, Phil Twyford announced today.
“New Zealand’s ratification yesterday, alongside Australia, triggered the entry into force of what will become the world’s largest free trade agreement and further accelerate our COVID economic recovery,” Mr Twyford said.
“Businesses will be able to take advantage of RCEP’s opportunities from early next year.”
Once fully in force, RCEP will be a trade agreement between 15 economies in the Indo-Pacific region that is home to almost a third of the world’s population, nearly a third of the world’s GDP, and collectively takes over half of New Zealand’s exports.
“This will unlock huge economic benefits for exporters and businesses, as well as new market access,” Minister Twyford said.
For New Zealand exporters, businesses and investors this means:
- A single set of trade and investment rules across the entire RCEP region, increasing certainty and reducing complexity;
- The opportunity for our exporters to get their products into RCEP-wide regional value chains;
- More market access opportunities, especially for services and investment into China and some ASEAN member states;
- Less red tape for exporters, and more streamlined trade; and
- New rules on government procurement, competition policy and electronic commerce, which will help New Zealand exporters take advantage of increased business opportunities.
“Our primary industries will also benefit – with the new expectation that Customs authorities will release perishable goods within six hours of arrival, helping to reduce spoilage and save money. And the meat industry specifically will benefit from the elimination of tariffs on some meat products into Indonesia.”
“This agreement will also enable our businesses to be better connected via regional supply chains and provide more certainty to exporters in what remain globally uncertain times,” the Minister said.
Independent analysis by ImpactECON has shown that over a period of 20 years, New Zealand’s annual GDP will be between 0.3% and 0.6% larger as a result of the agreement, amounting to an increase of between NZD $1.5 billion to NZD $3.2 billion.
“At a time of increasing international unpredictability, this agreement shows that we remain firm in upholding international rules and are a committed international participant. It gives us an influential seat at the table where the economic decisions for our region will be made.”
“ASEAN countries are a critical part of the global economy. New Zealand and Australia’s dual ratification of the ASEAN-led RCEP agreement demonstrates the strong relationship we share with ASEAN,” said Mr Twyford.