Sheep and beef farmers welcome new TPP deal

RURAL REPORTERS, November 13 2017

Sheep and beef farmers are thrilled a deal has been struck to move ahead with the Trans-Pacific Partnership Agreement.

The agreement is now called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

B+LNZ chief executive Sam McIvor, said the partnership would deliver big gains to the red meat sector.

“New Zealand’s regions are hugely reliant on revenue flowing as a result of exports.  Trade is the lifeblood for our sector, which in turn creates jobs and supports communities around New Zealand.”

More than 90 per cent of New Zealand’s sheepmeat and 80 per cent of the beef production is exported.  McIvor said the exports supported about 60,000 jobs on farms and in processing companies, and a further 20,000 jobs in supplying sectors.

“This deal simultaneously opens up multiple markets in Japan, Mexico, Peru and Canada and puts us on a level playing field with other major red meat exporters in the Asia Pacific region, such as Australia and the European Union.”

Meat Industry Association chief executive Tim Ritchie said since Australia’s 2015 trade agreement with Japan, their beef exports to Japan had increased by $NZ1 billion, while New Zealand’s had fallen by $NZ30 million.

“Demand in Japan for beef has been growing, but we have lost significant market share.  The situation got tougher in August when Japan imposed a WTO safeguard on frozen beef, raising its tariff on New Zealand exports from 38.5 per cent to 50 per cent, while Australia only faces a tariff of 22 per cent.  Since the safeguard was applied, our frozen beef exports to Japan have fallen by 70 per cent.”

The agreement announced captures all of the market access gains of the previous TPP agreement.  However, it also addresses some of the concerns of New Zealanders around TPP – the preservation of PHARMC, foreign ownership of land and housing, and freedom to regulate for our own environmental protection.

Meanwhile, the red meat industry is also celebrating the release of a WTO Appellate Body report which upholds the initial findings of the New Zealand-led dispute against Indonesia on a range of agricultural non-tariff barriers.

Ritchie said the barriers had impacted on New Zealand beef exports to Indonesia and had contributed to a decline of more than 80 per cent since 2010 – costing the sector an estimated $1 billion in lost trade.

“We welcome the Appellate Body’s confirmation Indonesia needs to take action to bring these measures into conformity with global trade rules.

“This reinforces the importance and value of the WTO in disciplining pervasive non-tariff barriers that plague the industry.”

McIvor said the sector recognised taking a WTO case was costly both financially and from a resourcing perspective.