May 18, 2017 6:15 am JST

New Zealand's free trade vision includes China

Island nation seeks to shape Asia-Pacific commerce rules to its benefit

KAORI TAKAHASHI, Nikkei staff writer

TOKYO -- New Zealand is renegotiating its free trade agreement with China as part of a larger strategy of helping steer the creation of favorable rules for commerce in the Asia-Pacific region.

During his visit to Japan on Wednesday, Prime Minister Bill English recommitted New Zealand to implementing an 11-member Trans-Pacific Partnership trading bloc without the U.S. The TPP includes countries with which New Zealand lacks bilateral trade deals, such as Japan.

But New Zealand is also drawing closer to China. The two nations struck a deal in March to expand Chinese imports of meat from the island country. New Zealand also became the first Western developed nation to sign a cooperation agreement on China's Belt and Road infrastructure initiative.

The two governments began talks on an enhanced free trade agreement last month.

"One of the reasons for the upgrade was because the volume of trade was much greater than we expected at the time of signing the agreement in 2008," English told The Nikkei in an interview here Wednesday.

New Zealand is pursuing the TPP, a trade deal with the European Union and an enhanced one with China all at the same time because it is important for Wellington "to make sure we have the capacity to be trading as much as possible."

In March, New Zealand set a target of expanding the value of goods exports covered by free trade deals from 53% of the total to 90% by 2030. The country also seeks to update a trade agreement with the Association of South East Asian Nations toward that aim.

As for the possibility that pursuing greater trade with China could lead to delicate political issues, English struck a pragmatic tone.

"China runs a different system than ours, and trade is a way of connecting with them that's proven to be positive and successful," he said.

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