China’s Minister of Commerce Wang Wentao and New Zealand’s Minister for Trade and Export Growth Damien O’Connor recently announced that both sides have completed domestic approval procedures for the Protocol on Upgrading the Free Trade Agreement between the Government of the People’s Republic of China and the Government of New Zealand，which will enter into force on 7 April 2022. The year 2022 marks the 50th anniversary of the establishment of diplomatic relations between China and New Zealand, and both sides see it as an opportunity to implement the upgrade protocol with high quality and further promote bilateral trade and investment, jointly promoting the bilateral economic relations to a higher level and further enriching the strategic partnership of the two sides.
The Upgrade has further modernized the FTA promoting higher quality, which is bound to deliver more benefits to enterprises and people of both countries. On Trade in Goods, China agrees to lower tariffs on wood and paper products from New Zealand and the two sides agree to further improve trade rules such as rules of origin and regulation, customs procedures and facilitation, and technical barriers to trade.
On Trade in Services, both sides agree to a significant expansion of the MFN commitment in the original FTA to more service sectors, and to conduct follow-up negotiations in the form of a negative list within two years after the entry into force of the Upgrade Protocol to further enhance openness. In terms of specific commitments, New Zealand agrees to expand market access commitments in service sectors such as legal services, engineering services, integrated engineering services, and to make new market access commitments in service sectors such as management consulting and related services. As for the work permits for special occupations, New Zealand agrees to increase its quota for Chinese language teachers and Chinese tour guides. China agrees to further expand its market access commitments in sectors including aviation, education, finance, elderly care, and passenger transport to New Zealand.
As for Investment, New Zealand agrees to ease the screening threshold for investment from China, and has committed to apply the same threshold to Chinese investors in line with other CPTPP members. Accordingly, the government-related investments in New Zealand’s significant business assets above $100 million, and non-government investments in New Zealand’s significant business assets above $200 million should be subjected to screening.
In terms of rule-making, the two sides commit to reinforce cooperation in areas like e-commerce, competition policy, government procurement, environment and trade. In particular, the chapter on trade and environment goes beyond the RCEP, which contains high-standard articles on environmental protection, environmental law enforcement, and implementation of multilateral environment conventions.
The Upgrade Protocol is China’s first upgraded FTA with a developed country,which adds a new “first” to the China-New Zealand partnership and makes a good start to joint celebrations of the 50th anniversary of the establishment of diplomatic ties between the two sides this year. The signing and implementation of the Upgrade Protocol is further testament to the potential for practical collaboration in various fields between the two sides, and a demonstration of our common commitment to safeguarding multilateralism and free trade. China is willing to work together with New Zealand,by upholding the spirit of striving to be the first, to fully implement the Upgrade Protocol and make the pie of shared interests bigger, thus promote better development of the two countries in the post-pandemic era and bring more benefits for both countries and peoples.