New Zealand Trade

Trade balance for the last 5 years – exports, imports, balance

New Zealand is highly dependent on foreign trade, specifically the export of agricultural products, especially dairy products, meat, wool, fruit, vegetables, fish and other items. Foreign trade accounts for about 30% of New Zealand’s GDP. Mainly engineering products, vehicles, oil and oil products, and electronics are imported to New Zealand. New Zealand’s main trading partners are traditionally Australia, China, the EU, Japan and the USA.

Trade balance 2014-2019 (NZD billion)
2016 2017 2018 2019
Export 67 475 70 870 76 300 82 463 83 600
Importation 65 137 67 229 72 200 80 800 81 900
Balance 2 337 3 641 4 200 1 663 1 700

Source: www.stats.govt.nz/browse_for_stats

The development of New Zealand’s trade balance during the year is linked to the seasonality of the export of agricultural products and their world prices. NZ’s most important export commodities include meat, dairy products, timber, fruit, vegetables and nuts, fish and wool.

NZ exports of goods and services reached NZD 8billion in 2019. NZ imports totaled NZD 8billion in 2019. Foreign trade ended in a surplus of NZD billion. Of the total exports, the export of goods amounted to NZD 58.4 billion.

The three largest trading partners – China, Australia and the EU – account for almost half of NZ’s total foreign trade. The main export destinations are China and Australia, NZ imports mainly from the EU and Australia.

Territorial structure – position in (k) EU

In 2019, the largest share of NZ exports went to China (NZD 18.14 billion) and Australia (NZD 14.16 billion). In 2018, China overtook Australia in total trade volume for the first time.

NZ export to selected countries in NZD billion
2015 2016 2017 2018 2019
Australia 12 994 12 966 13 623 14 128 14 157
China 10 342 12 110 14 816 17 329 18 148
USA 7 920 8 314 8 461 8 707 8 981
Japan 3 617 3 881 4 087 4 423 4 461
South Korea 2 085 2 162 1 992 2 345 2 330
EU 8 098 8 805 8 614 5 600 9 402

Source: businesscarriers.com

Import

The most important import partners are the EU (NZD 14 billion) and the PRC (NZD 13 billion), followed by Australia, the USA, Japan, and Singapore. Of the economic groupings, APEC and ASEAN countries traditionally have the largest share of imports. Among the top exports are dairy products and timber to the PRC (NZD billion and NZD billion).

In 2019, the import of goods from the EU amounted to over 11 billion NZD, while the import of services amounted to billion NZD. The most important item of NZ imports from the EU are motor vehicles (billion NZD). The EU’s most important export items to New Zealand also include pharmaceutical products, machinery and equipment, pharmaceutical products, aircraft and their components, electrical equipment and equipment.

NZ imports from selected countries in NZD billion
2015 2016 2017 2018 2019
Australia 11 333 11 263 11 956 12 635 12 786
China 9 454 10 758 11 265 12 848 13 089
USA 8 012 7 937 8 522 9 338 9 373
Japan 3 332 3 354 4 071 2 364 4 536
South Korea 2 179 2 204 2 042 2 894 2845
European Union 11 521 12 118 12 981 10 700 14 377

Source: www.stats.govt.nz

Commodity structure

Export

In 2019, the most important export items were milk and milk products, tourism services, meat and offal, wood and wood products. The largest number of dairy products, wood and wooden sayings, meat and offal were exported to China, the EU and Australia were the largest buyers of tourism services.

Commodity structure of exports 2019 – top ten
Kind of goods Export value in billion NZD
Milk and milk products 14 794
Business and private travel 11 251
Meat and offal 7 631
Wood and wood products 5 385
Educational travel 1 864
Fruit 3 294
Air Transport 2 606
Milk mixtures, cereals, flour, starch 2 051
Machines and machinery 1 865
Wine 1 760

Source: www.stats.govt.nz

Import

New Zealand’s imports are dominated by automobiles, parts and accessories, mechanical machinery and equipment, business and other private travel services, and mineral fuels.

Commodity structure of imports for the period 2019 – top ten
Kind of goods Value of imports in billion NZD
Vehicles and equipment 8 666
Mechanical machinery and equipment 8 543
Petroleum products 7 389
Business and private travel 6 523
Electrical machinery and equipment 5 032
Other business services 3 547
Textiles and textile products 2 680
Air Transport 2 676
Plastic and plastic products 2 226
Naval transport 2 153

Source: www.stats.govt.nz

 

Investments – foreign direct investments in the territory (sectoral and territorial structure)

The NZ government has one of its priorities to increase the inflow of foreign direct investment to all parts of NZ, which it states in its “Investment Attraction Strategy” from 2015. Another essential document for the development of the NZ economy, including investment, is the Business Growth Agenda 2017 Refresh.
Foreign direct investment was worth NZD 113 billion as of March 2019. Most investments in New Zealand come from Australia, Hong Kong, USA, Japan, Great Britain. The largest share of investments falls into financial and insurance services and the primary sector.

FDI in New Zealand in millions of NZD as of June of the given year
2015 2016 2017 2018
Australia 52 184 51 166 55 958 56 900
Hongkong 5 235 5 422 6 990 9 600
Japan 4 833 4 925 5 519 5 600
Great Britain 5 016 5 643 5 663 5 300
USA 8 205 7 787 9 190 9 400
In total 100 608 98 661 107 664 113 000

Source: Scoop portal, www.stats.govt.nz

Investments – conditions for entry of foreign capital (restrictions, incentives for investors)

New Zealand is a traditional importer of capital, which helps the internationalization of the economy and the country’s competitiveness. Foreign investments are monitored by the OIO (Overseas Investment Office). An Overseas Person must receive approval to invest in the following cases:

  • purchase of so-called “sensitive land”
  • purchase of commercial property for more than NZD 100 million
  • fishing quotas

The above restrictions do not apply to foreigners who permanently live in New Zealand, so-called permanent residents.

Foreign investment is regulated by The Overseas Investment Pact and Regulations 2005. Since 2011, the OIO office has been guided by the directive of the Minister of Finance, especially in relation to the purchase of land. In general, a foreign investor cannot buy a plot of land 10 times larger than the average farm size.

There are no specific investment incentives, a stable economic environment, advanced functioning infrastructure and trouble-free law enforcement are considered sufficient for the country’s investment attractiveness. New Zealand has traditionally been at the forefront of global rankings of competitiveness and economic freedom. New Zealand offers permanent residency for investors over NZD million (with the requirement of English proficiency and a minimum five-month stay per year) and over NZD 10 million, for whom the requirement of English proficiency is waived and it is sufficient to spend 44 days out of three years in New Zealand Zealand.

On 22 November 2018, a ban on the purchase of real estate ( Overseas Investment Amendment Bill ) by non-resident aliens, with the exception of citizens of Australia and Singapore covered by mutual free trade agreements, came into force. With increasing foreign investment in real estate in mind, the ban was introduced primarily to increase housing affordability for New Zealanders.

The Delegation of the European Union has been operating in Wellington since May 2004. Its leader and ambassador is Mr. Bernard Savage.

Representation of the EU in the country

Postal Address: PO Box 5106
Address: Level 14, Solnet House
70 The Terrace
Wellington 6011, NEW ZEALAND
Tel.: +64 4 472 9145

The country’s trade relations with the EU

The cooperation between New Zealand and the EU is currently based on the Partnership Agreement on Relations and Cooperation (PARC) between New Zealand and the EU, which has been in force since 1999. At a joint meeting in Brussels on 29 October 2015, President Juncker, President of the European Council Tusk and NZ Prime Minister Key agreed to start the negotiation process of the future NZ-EU FTA. The so-called scoping exercises were completed in March 2017. The 1st and 2nd round of negotiations took place in June and October 2018. In 2019, four more rounds of negotiations took place in February in Brussels, in May in Wellington, in July again in Brussels and in December again in Wellington. So far, the last round of negotiations took place via video conference on March 30 – April 9, 2020.

The EU is the third largest trading partner for New Zealand, trade in goods and services with the EU accounts for 13.5% of the total trade exchange of goods and services for New Zealand. NZ exports to the EU (outside Great Britain) reached NZD billion in 2019, while imports from the EU reached NZD 12.11 billion. The largest items of NZ exports to the EU in 2019 were meat, fruit and wine, seafood. The main imports from the EU to NZ are machinery and machinery, automobiles and their spare parts and accessories, aircraft and parts, medicines and pharmaceuticals.

From the EU-NZ FTA, the New Zealand side expects a NZD 1.2-2 billion increase in NZ GDP, a 20% increase in exports from the EU and a reduction in tariff and non-tariff barriers. Food production (the EU’s interest in protecting geographical indications of origin for food, especially cheese) and the length of patent protection for biological drugs (NZ has set it to 5 years, while the EU has extended it in some trade agreements to up to 10) are perceived as problematic points of negotiation. years; NZ fears increase in drug prices). In early December 2019, the NZ Ministry of Foreign Affairs and Trade (MFAT) released a document in which it seeks to accede to one of the EU’s key proposals in the EU-NZ FTA negotiations on the protection of geographical indications. MFAT has announced that the EU has put forward proposals, the adoption of which would cause significant changes to existing GI legislation. The EU requires

Due to Brexit in February, New Zealand is dealing with the protection of the status of current meat export quotas between New Zealand – the EU and the post-Brexit UK.

In mid-September, UK Trade Secretary Liz Truss visited NZ to discuss a post-Brexit free trade deal with her NZ counterpart, David Parker. Truss said New Zealand was a priority country for Britain to reach a joint Free Trade Agreement.

Provision of development funds and EU instruments

The EU ranks New Zealand among the program countries that can receive funds from the Partnership Instrument. The EU supports student mobility as well as the mobility of teachers and researchers within the framework of Erasmus+.

New Zealand Trade