21 Nov 2012

Hope that political interest may smooth exports

6:38 am on 21 November 2012

Dairy and meat sector chiefs hope that calls from Chinese politicians for more imports of primary produce from New Zealand could help clear obstacles remaining on that trade route.

Despite New Zealand's free trade deal with China, exporters still have tariff and non-tariff trade barriers to overcome.

Outgoing Premier Wen Jiabao told Prime Minister John Key at the East Asia Summit in Cambodia that China wants more of New Zealand's products..

Despite having signed a free trade deal in 2008, dairy exports from New Zealand to China above a certain quantity face penalty tariffs ranging from 10% to 20%.

The Dairy Industry Association says if those tariffs were removed it could sell even more to the Asian powerhouse.

Beef + Lamb New Zealand says it wants to see restrictions on beef exports removed.

Trade Minister Tim Groser said Mr Wen's comments increase the likelihood that some of these issues can now be addressed.

But he said a small country like New Zealand cannot dictate to China how it must run its economy and any negotiations must be managed carefully.

China has used the tariffs, which were included in New Zealand's trade deal in 2008 to protect Chinese farmers from surging imports, as the dairy trade has boomed.

Before a trip to Beijing last year, Trade Minister Tim Groser said he was contemplating raising the tariffs with his Chinese counterpart, but never did.

The tariffs are not due to be phased out till 2020.