9 Aug 2016

Govt was aware of China trade dispute in May - McClay

8:39 pm on 9 August 2016

The government says it was aware in May that China had trade concerns and the two governments discussed trade competition issues at the time.

Zespri Kiwifruit is loaded onto the Atlantic Erica at the Port of Tauranga.

Photo: Supplied

But Trade Minister Todd McClay insists the law prevents him from saying exactly what the dispute was about.

09082016. Photo Rebekah Parsons-King. Caucas run.Todd McClay.

Trade Minister Todd McClay Photo: RNZ / Rebekah Parsons-King

Last month, it emerged the Ministry of Foreign Affairs and Trade had been investigating claims industry players in China had warned the kiwifruit exporter Zespri of possible trade retaliation over claims of steel dumping.

Steel makers were reported to have complained that Chinese manufacturers were dumping excess product here.

The practice of 'dumping', or selling surplus goods below cost, is illegal under most trade agreements, and the Chinese industry players were said to have threatened trade retaliation if the claims were investigated.

Initially, Mr McClay described media reports around the issue as "extremely hypothetical".

Today, he said the two governments were discussing concerns as far back as May.

Labour leader Andrew Little said the government was not being straight.

"The idea that the Ministry of Foreign affairs would be dealing since May with allegations of retaliatory action, and the minister either not across that, or prepared to talk about it, or apparently not briefing his own Prime Minister, I think that is indefensible for a minister and I think we need to know more."

Zespri's exports to China were halted on Friday after Chinese officials reportedly found fungus in two containers.

The exporter said China was responding appropriately to the discovery and sales would continue, with shipping to resume once new protocols were put in place - which it said could take up to a week.

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