Growing the pie: the importance of Asia to NZ’s exports

Presentation to the EPIC NZ conference

John BallingallDeputy Chief Executive18 May 2012

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Outline

► Why NZ needs to lift its exports► How Asia helped us through the recession► NZ exports are already shifting toward Asia► The shift is expected to continue► On-going NZ opportunities► FTA benefits/risks

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NZ needs to lift its exports

Source: OECD

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Asian demand helped us through GFC

Source: Stats NZ

Contribution to NZ's goods export growth, past 3 years

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Goods trade is shifting to emerging-Asia…

Source: Stats NZ

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…as are exports of services

Source: Stats NZ & Education Counts

through visitor arrivals and international student numbers*

* (2011) Does not include Australian students

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Asia is NZ’s biggest F&B market

Source: Coriolis (2012)

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…and will continue to grow due to

Source: IMF

the region’s rapid growth in income and economic importance

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Demand for NZ exports…

Source: ITC

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…is growing quickly in Asia

Source: ITC

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NZ has a current advantage from FTAs

NZ-China FTAChina tariffs

NZ All others

Milk Powder 0' 10Beef 0+ 12Wool 0* 38Lamb 0+ 15Butter 0= 10

'Eliminated in 2012+Eliminated in 2016

*Country specific tariff quota of 28,941 tonnes=Eliminated in 2017

AANZFTAIndonesia tariffs

NZ All others

Milk Powder 0' 5Frozen Beef 0 5Malt extract 0 5Butter 0 5Fibreboard 0 5

'Eliminated in 2019

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Summary

► NZ’s export performance has been lagging► China lessened our burden from the GFC► NZ export patterns are shifting to Asia► The region’s performance will see this continue► Asian demand for NZ’s exports is growing rapidly► FTAs present NZ with a temporary advantage in

some of these markets