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Address at Opening of CEP Seminar, Bangkok

WEDNESDAY, 20 APRIL 2005

Rt Hon Helen Clark
Prime Minister

Address at Opening of CEP Seminar Conrad Hotel,
Bangkok

10.00am (3.00 pm NZ)
Wednesday 20 April 2005

Minister Thanong, ladies and gentlemen.

Thank you for joining us at this seminar on “Doing Business with New Zealand”.

During the course of this morning we want to share with you some of the practical implications of the Closer Economic Partnership (CEP) agreement between Thailand and New Zealand which was signed yesterday. We also want to update you on the trade and investment environment which Thai business people will encounter in New Zealand.

I am very pleased to be sharing the opening of the seminar with Commerce Minister, HE Dr Thanong Bidaya, who will present thoughts on Thailand’s objectives for this agreement and the opportunities it presents. New Zealand’s Trade Minister Jim Sutton will give the closing address, and also take time to answer any questions you may have.

Before Dr Thanong gives a Thai perspective of the new trade agreement, I want to outline some of the reasons why New Zealand sees it as so important.

Thailand is already a valuable market for New Zealand goods, but it is one which has by no means reached its potential. Trade between us is largely complementary – we export agricultural products and a range of niche manufactured and processed food products to this country, while Thailand’s main exports to us are motor vehicles, computers and electrical machinery, and processed seafood.

So, for example, New Zealand farmers exporting milk powder to Thailand may well be driving around their farm vehicles which have been assembled in Thailand.

The complementary nature of our trading relationship, however, was only one of the reasons why it seemed natural to Prime Minister Thaksin and me that New Zealand and Thailand should consider formalising our economic relationship through a CEP.

We also took account of the growing people-to-people links:

- the 19,000 Thais who visit New Zealand, and the 70,000 New Zealanders who come here each year.
- the 4,000 plus Thai students now in New Zealand each year, the greatest number from any ASEAN country.
- the well-established Thai community within New Zealand. I’ve just missed Songkran here, but I can assure you it was enjoyed by several thousand Aucklanders who came to the big festival in my constituency!
We also took into consideration our long-standing, and expanding, political linkages.

Next year we will celebrate fifty years of Thailand/New Zealand diplomatic relations. This year we celebrate thirty years of ASEAN-New Zealand relations. That has already been marked by the commemorative New Zealand-Australia-ASEAN Summit in Vientiane last November.

At that Summit we decided to begin negotiating a free trade agreement between ASEAN and New Zealand and Australia. The CEP we have just signed will be a building block in that exercise.

I believe that the CEP agreement will be the key to unlocking the full potential of the trade and economic relationship between New Zealand and Thailand, and of growing our relationship overall.

The CEP has comprehensive coverage of trade in goods. It will ultimately remove all the tariffs and quotas which currently either add to the cost of trade between our two countries, or impede it altogether. A good proportion of this market opening will occur early on. For New Zealand exports to Thailand, the new opportunities will be particularly significant, as tariffs apply to virtually all imports from New Zealand. For Thai exports to New Zealand, fully 85% of current trade will enter duty free from July this year.

Another important element of the CEP will be the trade facilitation provisions aimed at reducing regulatory barriers to trade. The Agreement provides for the establishment of experts’ groups to address issues affecting trade between the two countries. It would be unrealistic for these not to arise, but both New Zealand and Thailand are committed to making this an agreement which works. Future negotiations on services and government procurement will round out the Agreement.

Just as significant as the literal provisions of the Agreement will be the spur that the CEP provides for New Zealand and Thai business people to get out and explore what each country has to offer the other. This seminar is one opportunity for doing that. Ultimately, the vision that Prime Minister Thaksin and I share for this relationship is not just to grow bilateral trade, but also to enable both New Zealand and Thailand to be more effective players in the global economy.

Let me give you one example of the kind of “win/win” partnership that the CEP is designed to facilitate. A New Zealand company, Old Fashioned Foods, (represented at this seminar by Managing Director Ross McKenzie) is working with Thai companies Sipso and Kamolkij (pronounced Kum-on-kit). The joint venture with Sipso will bring together milk powder from New Zealand with Thai jasmine rice. The venture will jointly market a canned rice pudding produced in Thailand into world markets. This is the type of arrangement we expect to see more of under the CEP, and is a good example of how our two countries can work co-operatively together by pooling our strengths.

Over the coming months, here in Bangkok and in New Zealand, my government looks forward to working with Thailand on a programme of activities, to help turn the text of the CEP agreement into new business partnerships, increased sales of goods and services and greater two-way investment.

This seminar is but one of a number of activities which the New Zealand Government is undertaking to promote the Closer Economic Partnership:

- Already, a group of Thai dairy farmers have come to New Zealand as guests of Fonterra, our mega dairy co-operative. Their visit was linked to the development of a dairy co-operation strategy which will support the CEP.

- Thai media have been in New Zealand at our invitation, with the objective of raising awareness about New Zealand and the opportunities for Thailand in our export and import trade.

- Next month, government agencies will be running a road show around New Zealand, promoting the opportunities offered by the CEP.

- New publications on doing business in Thailand are being produced for the road show.

- New Zealand Trade and Enterprise also proposes to bring Thai supermarket buyers to New Zealand to explore food and beverage opportunities arising from the CEP.

- As well, government agencies are exploring opportunities for developing business links in the area of environmental technology expertise.

From all this activity, it can be seen that the New Zealand Government is serious about making the most of this new CEP.

We see it as being of broad benefit to both countries, with spin-offs far beyond the narrowly economic.

Our experience with other close economic partnerships is that they act as a catalyst for more education, scientific, and people-to-people links.

Our hope for the Thailand-New Zealand CEP is that it will strengthen our relationship overall. That will be positive for us, and for our region.
I have pleasure in declaring this seminar open.

ENDS

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