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Chartered Accountants ANZ report on Future of Trade

Government and business leaders need to energise the business community
on benefits of trade deals

Results from a survey indicate the Government should prioritise communicating the benefits of existing deals over establishing new agreements

30 March 2017: Chartered Accountants Australia and New Zealand is calling for the Government to increase awareness of the benefits of free trade after new research revealed many businesses are failing to understand and realise the value of free trade deals.

As part of its updated trade strategy announced last week, the Government said an advisory group will work to ensure the public is better informed on trade issues, but Chartered Accountants ANZ CEO Lee White says Kiwi businesses also need education.

The latest research from Chartered Accountants ANZ shows that the majority (72 percent) of New Zealand businesses think free trade agreements (FTAs) have no impact, are unsure of their impact or think these deals have a neutral impact.

The research is based on a survey of over 1,500 senior members of Australian and New Zealand businesses regarding their current trading arrangements and perceptions of future trade.

International trade is under the spotlight following a rise in protectionism.

“It is critical the Government focuses on educating businesses about the benefits of trade agreements,” White said. “Negotiating deals is only half the battle.

“The survey revealed a real disconnect between the potential benefits of FTAs and the perceived or realised benefits for businesses.

“Our research indicates the Government should prioritise communicating the benefits of existing deals over establishing new agreements.”

The Future of Trade also calls for Government to invest in technological and process improvements to reduce customs delays.

“International trade underpins New Zealand’s economic prosperity. It is imperative that we better communicate its benefits and opportunities,” said White.

Report co-author and partner at Deloitte Access Economics, David Rumbens, echoed the call for an enhanced government focus on streamlining border processing for businesses.

“Streamlining customs and border processing should be an absolute priority to ensure the free trade agreements secured with New Zealand’s trading partners are working as effectively as possible,” Rumbens said.

“Government facilitation, including steps towards digitising customs and border processing, would help improve outcomes for New Zealand exporters.”

The top trends identified in the paper are:

• Nearly one-fifth of survey respondents believe online platforms would be their main means of reaching consumers in the next five years.
• Businesses prefer small changes over wholesale shifts in trade policy.
• Half of New Zealand businesses have suppliers located in Asia and 60 percent had customers in the region.
• Businesses view technology and digital trends as one of the main drivers of change over the next five years.
• Ethical and environmental considerations will become increasingly important to customers.

Trade Minister Todd McClay will speak at a New Zealand launch of the report in Wellington on Tuesday 4 April. A panel of trade experts and business people will also discuss the Future of trade.

ENDS

121616_Future_of_trade_Web_FA.pdf

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