Goff welcomes US decision to negotiate with the P4
Goff welcomes US decision to negotiate with the P4
Trade Minister Phil Goff has welcomed a United States decision to join negotiations on financial services and investment with four countries including New Zealand, and at the same time to begin a process aimed at possible participation in a comprehensive free trade agreement.
United States Trade Representative
United States to Join Sectoral Negotiations with Four Asia-Pacific Countries Will Explore Participation in Broader Strategic Partnership Agreement
Washington, D.C. -- U.S. Trade Representative Susan C. Schwab announced today that the United States will join negotiations on investment and financial services set to begin in March among Singapore, Chile, New Zealand and Brunei, known as the “P-4” group of countries. These four countries have negotiated their own Free Trade Agreement (FTA), the Trans-Pacific Strategic Economic Partnership, based largely on the United States’ FTAs with Singapore and Chile. While the Trans-Pacific Strategic Economic Partnership Agreement entered into force in 2006, the investment and financial services chapters remain to be negotiated.
“We see these investment and financial services negotiations as an opportunity to further our engagement with countries committed to high-standard trade agreements,” said Ambassador Schwab. “This initiative also will provide another opportunity for the United States to participate in the regional trade architecture that is emerging in the vitally important Asia-Pacific region.”
As it begins investment and financial services negotiations with the P-4 countries, the United States will also begin a detailed exploratory process to determine whether it should participate in the full Trans-Pacific Strategic Economic Partnership. The Administration will hold consultations on this proposal with Congress and a wide array of stakeholders over the coming months. Participation could provide a pathway to broader Asia-Pacific regional economic integration with like-minded countries committed to high-standard agreements. The United States is already pursuing further regional economic integration in the Asia Pacific Economic Cooperation forum (APEC) through intensive exploration of the prospect of a Free Trade Area of the Asia- Pacific (FTAAP), as well as through bilateral FTAs, such at the pending agreement with South Korea.
Trans-Pacific Strategic Economic Partnership Agreement (P4)
The Trans-Pacific Strategic Economic Partnership Agreement (P4) is the first multi-party trade agreement linking Asia, the Pacific and Latin America. All four members (Brunei Darussalam, Chile, New Zealand and Singapore) are members of APEC (Asia Pacific Economic Cooperation).
The P4 Agreement is a high-quality agreement that liberalises and facilitates trade in goods and services and aims to improve the business environment and promote cooperation on a broad range of economic areas of mutual interest to all four members.
The Agreement, which entered into force in 2006, includes provisions on market access and related rules (including customs procedures, rules of origin, sanitary and phytosanitary measures, technical barriers to trade, and trade remedies) for goods trade; trade in services; intellectual property; government procurement; competition policy; and dispute settlement.
Articles 20.1 and 20.2 of the Agreement provide for negotiations on Investment and Financial Services to be commenced within two years from entry into force. Article 20.6 provides that the Agreement is open to accession on terms to be agreed among the Parties.
All P4 members are also party to an Environment Cooperation Agreement and a Memorandum of Understanding on Labour Cooperation.
New Zealand/United States Trade and Investment Relations
The United States is a major trade and economic partner for New Zealand, second only to Australia in overall importance.
During the year to June 2007, NZ/US two-way merchandise trade totalled NZ$8.81 billion and was almost evenly balanced.
New Zealand exports to the US totalled NZ$4.33 billion, close to 11 percent of total New Zealand exports, making the US our second largest individual country market after Australia. New Zealand imports from the US totalled NZ$4.48 billion during the same period, almost 11 percent of total imports.
New Zealand exports mainly primary products to the US and buys industrial and manufactured products such as aircraft, medical equipment, vehicles, and computers. The US is New Zealand’s top individual market for dairy products (worth NZ$885 million in the year to June 2007) and meat ($1.04 billion), and among the five largest importers of New Zealand forest products ($345 million), seafood ($184 million), fruit ($98 million), vegetables ($36 million) and wine. Exports of wine to the US grew from NZ$4.3 million in 1997 to NZ$138 million in 2006, representing 27% of New Zealand total wine exports and making the US New Zealand’s second largest market after the United Kingdom.
The US is New Zealand’s third largest source of overseas visitors, after Australia and the United Kingdom, accounting for 221,000 visitor arrivals in the year to June 2007, 9 percent of total arrivals. In the year to March 2005, US visitors spent $615 million in New Zealand, making the US our third largest source of tourist expenditure. The large majority of visiting Americans are holidaymakers (around 70 percent), with business travellers accounting for close to 10 percent. Investment
New Zealand and the United States have a well-founded investment partnership.
In 2005, the stock of US investment in New Zealand totalled $40.7 billion (18.2 percent of total foreign investment in New Zealand). New Zealand investment in the United States totalled $20.1 billion (23.7 percent of total overseas investment). Portfolio investment makes up the bulk of investment in both directions.
New Zealand outward foreign direct investment flows into the United States in 2005 were estimated at around NZ$1.3 billion (7.1 percent of total outward FDI). During the same period, the United States was estimated as contributing NZ$8.8 billion of inward FDI to New Zealand (11.3 percent of the total).
Major US corporate investors in New Zealand include Rayonier, Hancock, Harvard Management Company, (all in the forestry sector), and Lockheed Martin. Investors in the film industry include Walden Media, NBC Universal and Disney. Major New Zealand investors in the United States include Fisher and Paykel Appliances, Fonterra and Fletcher Building.