Trade links between New Zealand and Taiwan will be bolstered under a new free-trade pact signed by the countries this week.
Directors of the New Zealand Commerce and Industry Office and the Taiwan Economic and Cultural Office, agreed to the terms of the New Zealand-Chinese-Taipei Economic Cooperation Agreement during a low key ceremony on Wednesday.
The agreement will see a tariff on New Zealand goods entering Taiwan gradually eliminated over the next three years.
Zespri chief executive Lain Jager welcomed the deal, saying it will help New Zealand’s single desk kiwifruit marketer grow its share in one of its most promising markets.
“Last year it (Taiwan) was our fifth-largest market with sales of over $100 million,” Jager said.
“With the existing tariff on New Zealand kiwifruit sitting at 20 percent, the agreement will see the tariff be completely removed by the 2017 season.
“This is a fantastic outcome for the industry and will ensure that Taiwan remains a priority market for Zespri.”
In 2012, New Zealand was Taiwan's eighth largest source of agricultural imports.
According to the Wall Street Journal, two-way trade between the countries is worth NZ$1.6bn (US$1.2bn) annually.
The free-trade pact is Taiwan’s first with a developed economy.
Economic analysts are viewing the agreement as a leveraging point for Taiwan to enter talks about their participation in the Trans-Pacific Partnership.
The partnership, made up of members across Asia, North America and Australasia, is negotiating terms for a next-generation trade agreement, with the lowering of seasonal tariffs a key item on the agenda.
“The political significance is probably greater than the economic impact, as this will be the first free-trade deal that Taiwan has achieved with a country that it doesn't have diplomatic relations with,” a report from DBS Bank analysts concluded.
The agreement is expected to come into effect during 2014, following examination from the New Zealand Parliament.
