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Consultations on India FTA / next step in Japan trade initiative

04 May 2009

On 21 February 2009, during a visit by New Zealand Trade Minister Tim Groser, New Zealand and India agreed to launch bilateral free trade agreement negotiations. 

This decision was based on the findings of a Joint Study between India and New Zealand on the advantages of a Comprehensive Economic Cooperation Agreement or a Free Trade Agreement, which was published on 30 March 2009 and found that: “significant complementarities" exist between the Indian and New Zealand economies and that a CECA/FTA would deliver a broad range of benefits to both countries. The study recommends to both governments that India and New Zealand commence negotiations as soon as possible on a comprehensive CECA/FTA agreement covering substantially all trade in goods and services; investment; trade facilitation; and other areas of economic cooperation, as a "single undertaking", leading to additional trade flows and economic gains.  MFAT is presently calling for submissions in preparation for the possibility of FTA negotiations proceeding, which are due by 29 May 2009.

On 9 April 2009, Mr Groser announced that New Zealand and Japan are establishing a Joint Officials Group to examine ways to further develop their bilateral trade and investment relationship.  This is a preliminary step before deciding whether or not to launch free trade negotiations and follows the 3 March 2009 report of a Joint Working Group, established in 2006 to investigate the prospects of closer economic cooperation.  Whilst Japan has long-standing diplomatic ties with New Zealand, it is a notable exception to New Zealand’s Asia Pacific FTA coverage, which now includes China and all ASEAN nations.  New Zealand has already arranged to conduct FTA negotiations with two of the other notable exceptions: Hong Kong (with which New Zealand announced the resumption of negotiations on 11 February 2009) and Korea (with which New Zealand announced the start of negotiations on 3 March 2009).  New Zealand’s enthusiasm with respect to Japan is also spurred in part by the progress of Australia-Japan negotiations, which are now in their eighth round.