RATIFICATION OF NEW ZEALAND-UAE COMPREHENSIVE ECONOMIC PARTNERSHIP AGREEMENT (CEPA)

STEPHEN JACOBI, EXECUTIVE DIRECTOR, NZIBF

Thank you Chair for the opportunity to appear before the Committee today.

I do so on behalf of the members of the NZ International Business Forum and Export NZ.  I serve as Executive Director of the Forum and as an Advisory Board member of Export NZ.

Our submission is a joint one and between us we represent exporters and international businesses across Aotearoa.

We are strongly in support of ratification of New Zealand’s latest FTA, the CEPA with the United Arab Emirates.

This is a high quality, comprehensive and ambitious agreement, the negotiation for which has been concluded in record time.

We are grateful to Trade Minister McClay and his officials for their excellent work.

As our submission notes, the agreement will provide comprehensive tariff elimination within a fairly rapid timeframe.

While currently applied tariffs are not high, there is now an opportunity to grow New Zealand exports especially in the dairy, red meat, seafood, horticulture, high value foods and agri-tech sectors. 

It should likewise create new opportunities for UAE goods, services and, through the companion Bilateral Investment Treaty (BIT), greater flows of foreign direct investment in our market. 

In terms of the trade rules it provides, the CEPA provides all the elements we would want to see from a high quality agreement along the lines of New Zealand’s other high quality agreements including CPTPP and the NZ/UK FTA.

This includes digital trade, competition policy, intellectual property, government procurement, labour, gender, climate change and environment issues and additional elements around ensuring that trade is both sustainable and inclusive.  

We are pleased to see the right of governments to regulate for legitimate public policy reasons, and the ability of the New Zealand Government to meet the Crown’s obligations to Māori, have been safeguarded.  

The CEPA has also been instrumental in securing a long sought-after FTA with the wider Gulf Co-operation Council – we look forward to this agreement coming before the Committee for ratification.

You may have noted that in para 28 of our submission, we welcome the agreement’s provisions aimed at delivering end-to-end, secure and trusted paperless trade. 

These provisions, which are non-binding, largely mirror undertakings in other trade agreements New Zealand has entered into.

Paperless trade refers to replacing the vast amounts of paper that move around the world accompanying goods as they move through supply chains.

Replacing paper with the trusted exchange of data can reduce costs, improve security and provide important information to regulators and consumers alike.

It is the sort of thing New Zealand can and should be doing as part of a package of measures to double export value.

Unfortunately it remains a disappointment to both our organisations that successive New Zealand Governments have so far failed to take the steps necessary towards devising a national strategy to implement paperless trade.

Such a strategy requires legislative change, engagement with trade partners including the UAE and boosting the capability of businesses.

We urge the Government now to follow through on the various undertakings to implement paperless trade as a number of our trading partner, like Singapore, the UK and Australia are doing.

Chair, Members of the Committee

The NZ/UAE CEPA is a very good agreement, one we can be proud of.

That, with your endorsement, the CEPA will come into effect at a time when we are facing a sharp increase in protectionism in the form of tariffs and other trade barriers around the world is significant.

It shows that there are still economies who believe in the value of openness, effective trade rules and economic integration.

For the reasons set out in our submission we recommend that the Committee indicate its support for the prompt ratification of the NZ/UAE CEPA.