With six of its top 20 global markets represented in the Trans Pacific Partnership (TPP), New Zealand kiwifruit marketer Zespri anticipates the multi-national trade pact to deliver long-term benefits to its industry.
Sales into Japan, Malaysia, the United States, Singapore, Australia, and Canada – all TPP member nations – currently generate a combined total of around NZ$500m. Zespri's chief operating officer Simon Limmer told New Zealand’s foreign affairs, defence and trade select committee that the TPP's ratification would help drive that figure towards NZ$750m by 2020, with the benefits continuing to multiply over time.
“It's not an immediate benefit back into growers' pockets, but the direct indirect benefit from that long-term investment and a sustainable position in that long term market is going to be very valuable,” Limmersaid, according to Scoop Independent News.
Zespri has calculated a NZ$15m saving in tariffs on exports to the Japanese market under the TPP, with the benefits set to trickle through the entire business.
“The $15m is the exact quantum in terms of what the tariff represents, but it will flow through in the market in terms of our ability to be more competitive,” he explained. “Now that flows through into additional volumes, additional run rates, our ability to build volume in the market, which does have an indirect financial benefit for us through the supply chain.”
Philip Turner, director of global stakeholder affairs at dairy giant Fonterra, also addressed the select committee, suggesting the real benefit for New Zealand exporters could be closer relationships with fellow member nations.
“The tariff savings are simply a crude proxy for trade opportunities which would result from greater market access,” Turner told Scoop Independent News. “More market access will benefit our farmers, but trying to quantify that is very hard.”
