New Zealanders will start to see the benefits of the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) from December 30 after confirmation today the required six nations have now ratified the trade pact.
“This triggers the 60 day countdown to entry into force of the Agreement and the first round of tariff cuts,” Trade and Export Growth Minister David Parker said.
“The timing means there will be the added bonus of a second round of tariff cuts on 1 January 2019 for New Zealand exporters into those markets which apply a calendar tariff year. In the case of Japan, this second round of tariff cuts would fall due on 1 April 2019.”
The remaining countries yet to ratify are Brunei Darussalam, Chile, Malaysia, Peru and Viet Nam.
Minister for Trade and Export Growth David Parker said the threshold to bring the deal into effect was crossed when Australia notified New Zealand today, as Depositary for the CPTPP, that it had completed its domestic procedures to ratify the Agreement.
Canada and Australia have joined Mexico, Japan, Singapore and New Zealand in ratifying the 11-country Pacific Rim deal.
CPTPP marks the first free trade deal for New Zealand with Japan, the third largest economy in the world, as well as with Mexico and Canada – both G20 countries.
“Canada is currently New Zealand’s 12th-largest export market worth over $1 billion in 2017. CPTPP should see this figure grow. There will be immediate duty free access for wine, processed meats, wool, forestry and fisheries products, while beef tariffs and quotas will be eliminated over six years,” David Parker said.
“Canada and New Zealand share a commitment to ensuring the benefits of trade and investment are broadly shared and we will be working together within the CPTPP grouping to achieve this.”
Also, having such a close trading partner as Australia among the first six to give effect to the CPTPP is positive for New Zealand.
“As we have said during the negotiations, New Zealand will continue to work closely together with Australia in pursuit of our shared interests to ensure the Agreement is implemented effectively once it enters into force.”
New Zealand and Australia have signed a reciprocal side letter alongside CPTPP which excludes the use of investor state dispute settlement (ISDS) between us. New Zealand also has reciprocal side letters on ISDS with Peru, Malaysia, Vietnam and Brunei.
Over 80 per cent of investment in New Zealand from within the CPTPP grouping is not covered by compulsory ISDS provisions.
“I expect other signatories will come on board after the CPTPP enters into force, as many are working hard to progress their applicable domestic procedures. As a result, we could well see other signatories in a position to ratify over the coming weeks and months.”