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There are clearly benefits for
those companies who manufacture in New Zealand either directly
or under licence with virtual open access to Australia under
CER and no border tariffs when accessing that market. (Labour
and shipping costs are generally less in New Zealand than Australia
and so the cost of Manufacture and delivery to market is generally
less) This needs to be measured against volume achievable in
low cost production facilities in the case of low value products.
New Zealand also has free trade
agreements with Brunei, Chile, China, Hong Kong, Malaysia, Singapore,
Thailand and a generic agreement with ASEAN countries. Other
free trade agreements are being negotiated so those remaining
border tariffs may be reduced to zero when importing from those
countries. Conversely these agreements provide a low and decreasing
rate of tariff for New Zealand made products going into markets
such as China that are well below the published tariff rates
and over time will move to zero. Rules of origin apply in both
direction however.
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