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The New Zealand- China relationship

The New Zealand- China relationship. Material for New Zealand-China Council Delegation. China is a central part of a huge structural shift in the global economy… . Source: OECD. …and New Zealand is responding to that shift.

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The New Zealand- China relationship

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  1. The New Zealand- China relationship Material for New Zealand-China Council Delegation

  2. China is a central part of a huge structural shift in the global economy… Source: OECD

  3. …and New Zealand is responding to that shift Goods exports to China have risen from $2 billion to $7 billion in 5 years during a global recession Source: Statistics New Zealand

  4. From humble beginnings… Source: Statistics New Zealand

  5. …China is NZ’s hottest export market and eased the pain of the global financial crisis China is responsible for $4.9bn of NZ's additional $9.5bn of exports since 2007

  6. Trade is becoming more balanced Source: Statistics New Zealand

  7. Strong growth in top 7 exports to China Source: Statistics New Zealand

  8. An increasingly important source of imports… Source: Statistics New Zealand

  9. …that are used by households and New Zealand firms for further production Top 10 = ~82% of total Source: Statistics New Zealand

  10. Exports of services are growing too: Chinese tourism spending has risen strongly Since GFC hit, Chinese tourism spending has risen by $380 million. Total spending by all tourists fell by $720 million.

  11. Tourism market is changing rapidly, driven by Chinese income growth Expect visitors from China to double by 2018 New Zealand tourism operators needs to think carefullyabout Chinese visitors’ demands Source: NZIER, MBIE

  12. Commercial services exports are small but widespread and growing Overall, China is now New Zealand’s 3rd largest services market, worth over $1 billion per year and growing Source: Statistics New Zealand

  13. New Zealand remains a popular place for Chinese students to learn Chinese students accounted for $560 million of GDP in 2011: 27% of the total GDP generated by overseas students Sources: http://www.educationcounts.govt.nz; Infometrics

  14. Investment has risen – both ways Only 0.61% of New Zealand’s total stock of foreign investment is from China… …compared with 16% of our total imported goods Of New Zealand’s total investment abroad, China received 0.59% in 2012, up from 0.13% in 2007 Source: Statistics New Zealand

  15. FTA provides a competitive edge 91% of tariff lines are duty free By 2016, all imports from China will be duty free By 2019, 96% of New Zealand exports will be duty free Leaders’ goal of doubling exports within 5 years from 2010 is an ambitious but feasible target

  16. But FTA preferences won’t last forever: we need to maximise our first-mover advantage

  17. Chinese economic challenges present opportunities for New Zealand firms

  18. Key takeouts The economic relationship has developed rapidly and is maturing well It’s more than just goods exports – the services, investment and people links are deepening The FTA has generated real momentum But preferential tariff advantage will be eroded over time as both countries sign more FTAs with other competitors Opportunities abound for New Zealand firms to help address big structural challenges in China

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