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Singapore Free Trade Deal Ok With Caveats

The Trade Committee of the Employers & Manufacturers Association (Northern) this morning gave a cautious thumbs up to the concept of a Singapore New Zealand Free Trade Agreement.

"The committee decided the agreement would on balance be advantageous to New Zealand provided several caveats were strictly observed," said the Chief Executive of the EMA, Alasdair Thompson.

"These are that:

* The Rules of Origin benchmark does not move below the 40 per cent threshold. Under CER with Australia goods must be determined to contain 50 per cent local content to qualify for duty free access. The committee is intensely aware that Singapore's traders have far easier opportunities to breach these rules than we do.

* WTO anti-dumping rules must be enforced with the onus of proof falling on importers to demonstrate goods subject to challenge and that could damage local producers are not being sold below the cost of production.

* Singapore's labyrinthine and extensive array of industry subsidies and incentives must become transparent. The extent and level of subsidies open to Singapore's producers are far beyond any New Zealand can match.

* Reciprocal recognition of qualifications. This issue is fundamental because many attempts to acquire design, construction, and other work contracts have foundered on Singapore being unwilling to recognise our skills. It is also extremely ironic and obvious as many Singaporeans have been educated in New Zealand.

* Mutual recognition of standards. This has been another area where non tariff barriers have been used to disqualify New Zealanders ability to obtain contracts in Singapore.


"Our manufacturers see no advantage at all in selling New Zealand's remaining, very limited scope for negotiation cheaply. We have no tariffs of much interest to Singapore, and few if any, other obstacles to free trade left with which to bargain. Our markets are already freely open to the products that Singapore mainly exports here.

"Clearly the benefits to both countries would be strategic rather than immediate.

"Nevertheless Singapore's traders are regionally well connected and in many cases heavily subsidised.

"However, if Singapore is prepared to allow New Zealanders to compete for infrastructure contracts and other skilled work, then the longer term opportunity for partnerships could deliver benefits here as well as to Singapore."


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