Study on China-Sri Lanka Free Trade Agreement

3.4 China-New Zealand Free Trade Agreement
New Zealand was the first developed country to propose FTA negotiations with China. In 2004, China
and New Zealand have embarked upon negotiations of a comprehensive free trade agreement
covering goods, services and investment, which would deliver benefits to both economies. However,
negotiations have been stretched over four years and after concluding their joint feasibility study the
agreement was signed on 7 th April 2008. 105 The FTA has come into effect on 1 st October 2008 and it
is expected to be fully implemented by 2019. While the trade in services agreement has used a
positive list approach for negotiations, the two countries have opened their service sectors in all four
modes 106 to each other’s markets on the basis of their commitments to the WTO. The Agreement is
China's first FTA partnered with a member state of the Organization for Economic Cooperation and
Development (OECD). 107
FTA was a significant factor in the 20 per cent growth in bilateral two-way merchandise trade in the
first year following entry into force, and to a doubling of bilateral trade in the past five years. 108
Benefits arising from the FTA include, inter alia, improved market access, improved customs
procedures and trade facilitation, increased efficiency, and enhanced transfer of technology and
skills. China is now New Zealand’s second-largest trading partner overall, as well as second-largest
source of imports and second-largest destination for exports. 109 New Zealand’s importance as a
trading partner for China has also grown with New Zealand’s share of China’s total trade rising from
0.17 per cent in 2007 to 0.21 per cent in 2009. 110
The Agreement is composed of 18 chapters: Chapter 1: Initial Provisions, Chapter 2: General
Definitions, Chapter 3: Trade in Goods, Chapter 4: Rules of Origin and Operational Procedures,
Chapter 5: Customs Procedures and Cooperation, Chapter 6: Trade Remedies, Chapter 7: Sanitary
and Phytosanitary Measures, Chapter 8: Technical Barriers to Trade, Chapter 9: Trade in Services,
Chapter 10: Movement of Natural Persons, Chapter 11: Investment, Chapter 12: Intellectual
Property Rights, Chapter 13: Transparency, Chapter 14: Cooperation, Chapter 15: Administrative and
Institutional Provisions, Chapter 16: Dispute Settlement, Chapter 17: Exceptions and Chapter 18:
Final Provisions. The Agreement has 13 annexes which contain the following: tariff schedules, special
agriculture safeguard measures, mid-term review mechanism, China’s country-specific tariff quotas
for wool and wool tops, product specific rules of origin, certificate of origin, declaration of origin,
schedules of specific commitments on services, sectoral coverage, visa facilitation, expropriation and
commitments on temporary entry by natural persons.
Table 3.7: Features of the China-New Zealand FTA
105 New Zealand Ministry of Foreign Affairs (2010), “The China-New Zealand Free Trade Agreement: Two-Year
Review Joint Report”, available at: [http://www.chinafta.govt.nz/4-Events-and-press/2-Press-releases/jointreport-feb2011.pdf]
106 Cross-border supply (Mode 1), Consumption abroad (Mode 2), Commercial presence (Mode 3) and
Presence of natural persons (Mode 4).
107 WTO Secretariat, Factual Presentation of Free Trade Agreement Between Chinn and New Zealand (Goods
and Services), 2010, available at: [http://rtais.wto.org/UI/PublicShowMemberRTAIDCard.aspx?rtaid=8]
108 Ibid.
109 New Zealand Ministry of Foreign Affairs (2010), “The China-New Zealand Free Trade Agreement: Two-Year
Review Joint Report”, available at: [http://www.chinafta.govt.nz/4-Events-and-press/2-Press-releases/jointreport-feb2011.pdf]
110 Ibid.
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