China’s Mushrooming Free Trade Agreements: New Zealand and China’s Upgraded Free Trade Agreement

Abstract

FTAs have mushroomed and proliferated at very fast pace in East Asia, especially after the Asian Financial Crisis (AFC) of 1997. The East Asian economies were very disappointed with the International Monetary Fund’s handling of the crisis. In particular, it provided some countries, like Thailand and Indonesia, with poor advice. After the AFC, countries like China, Japan, and South Korea signed FTAs with different countries around the world. The first East Asian FTA talks took place between Japan and South Korea in 1998. Like its neighbors, China also pursued FTAs with neighboring countries. The FTA between China and New Zealand was signed on the 7th of April 2008 and was implemented on the 1st of October 2008. As a result of this FTA, China has become New Zealand’s largest trading partner; New Zealand’s exports to China have quadrupled. As of June 2020, the trade between China and New Zealand exceeded NZ$32 Billion. China and New Zealand signed an upgraded FTA on the 26th of January 2021. The upgraded FTA includes rules relating to e-commerce, competition policy, government procurement, and environment and trade issues. The bilateral trade between China and New Zealand is complimentary rather than competitive; while China mainly exports manufactured products to New Zealand, New Zealand primarily exports agricultural products.