During the COVID-19 outbreak, commitments have been made between New Zealand, Singapore, and a number of key trading partners. These commitments include mainly about the trade lines they have.
The pandemic has created significant disruption to the global economy and world trade, as production and consumption are set back across the globe. Businesses are facing significant challenges and need to adapt rapidly. Many governments are trying to navigate their economy through this crisis with several measures.
Recently, New Zealand and Singapore have agreed to support their trade lines. They welcomed Canada, Australia, Chile, Brunei, and Myanmar to keep supply chains open and remove any existing trade-restrictive measures on essential goods. This agreement supports recent attempts the country has made to boost trade with key Latin American partners.
Trade relations between New Zealand and Asian partners
Singapore is one of New Zealand’s biggest trading partners and the seventh-largest export market. The majority of New Zealand companies export to Singapore as a strategic entry point and regional headquarters for further engagement with China and India.
Furthermore, in 2000 Singapore and New Zealand agreed upon signing a Closer Economic Partnership (CEP) to boost New Zealand exports to Singapore. These have been multiplied over the past 10 years and increased by over 50% according to NZTE (New Zealand Trade and Enterprise).
The main commitments made involve removing trade restrictions. In these difficult times, these countries want to make trade easier as the world economy is being affected significantly. These commitments made are mainly applied on medical supply trade.
Canada, Australia, Chile, Brunei, and Myanmar get on board
Recently, Canada, Australia, Chile, Brunei, Myanmar have joined New Zealand and Singapore by agreeing upon new commitments between New Zealand, Singapore and key trading partners. These commitments center around keeping the supply chain open and start removing trade restrictions such as trade tariffs, quota, and taxes. The main focus of the changes applies to medical supplies countries may be seeking to support their response to COVID-19.
New Zealand Minister for Trade and Export Growth, David Parker, announced, “I welcome the commitment made by Canada, Australia, Chile, Brunei and Myanmar in joining New Zealand and Singapore to help ensure our citizens can access the important goods and medical supplies we need in this time of global crisis”. It is important to maintain the trade lines open between these key partners, especially through air and sea freight to facilitate the flow of goods which includes these essential supplies.
Value of New Zealand top trading partners
In 2019, New Zealand shipped US$38.2 billion worth of goods around the globe. New Zealand is the 57th largest export economy in the world and around 58% of New Zealand’s exports in 2019 were sent to Asian markets, and 15.5% went to fellow Oceanian importers. New Zealand shipped 11.2% worth of goods to North America with 9.9% delivered in Europe. In 2019, 76.8% of New Zealand’s exports were delivered to the following 15 important trade partners:
- China, US$11 billion (28.8%)
- Australia, US$5.2 billion (13.6%)
- United States, US$3.6 billion (9.4%)
- Japan, US$2.3 billion (6%)
- South Korea, US$1.1 billion (2.9%)
- United Kingdom, US$953.1 million (2.5%)
- Hong Kong, US$810.3 million (2.1%)
- Taiwan, US$770.2 million (2%)
- Malaysia, US$695.7 million (1.8%)
- Indonesia, US$685.8 million (1.8%)
- Singapore, US$677.8 million (1.8%)
- Thailand, US$642 million (1.7%)
- Philippines, US$564.6 million (1.5%)
- Germany, US$543.8 million (1.4%)
- Vietnam, US$523.4 million (1.4%).
New Zealand’s trade lines with countries like Singapore are of utmost importance, as Asian markets play a big part of New Zealand’s export plan. Singapore offers a helpful hub for distributing goods further into the region. The government of New Zealand is also pursuing further opportunities in emerging regions like Latin America.
New Zealand’s trade relations with Latin America
New Zealand is very dependent on international trade. Therefore, Latin America is a very important trading partner since the continent obtains many useful resources. The Pacific Island nation is negotiating a very important trade agreement that is called the Pacific Alliance. This alliance is made up of Chile, Colombia, Mexico, and Peru, key markets in the region. This deal will build upon existing agreements such as the CPTPP, aiming to further remove barriers to trade.
Furthermore, New Zealand is part of the Cairns group, which is important for bringing agriculture exporting companies together. Countries that are part of this group are Argentina, Australia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, the Philippines, South Africa, Thailand, Uruguay, and Vietnam. The group works to remove export subsidies and improve market access for agricultural exporters.
Get support for New Zealand trade from local trade experts
The COVID-19 pandemic is affecting many businesses and economies globally. Governments are trying to make commitments to their trade lines between New Zealand, Singapore and key trading partners in Latin America, Asia and Northern America. Businesses may seek new trade opportunities in order to diversify their channels and gain a foothold in new consumer markets.
At Biz Latin Hub, we’re a market leader for supporting businesses from over the world to expand their business in, and trade from, new destinations in Latin America and Australasia. Our team of qualified professionals provides a suite of multilingual market entry and back-office services to get your business off the ground.
For more information about the recent changes and guidance for your business, contact us today here.
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