Substantial benefits from free trade agreement with Korea

A joint study by New Zealand and Korea has found that a Free Trade Agreement (FTA) would bring substantial economic benefits to both countries, Trade Minister Phil Goff said today.

The study was commissioned as part of a strategic partnership, entitled Partnership for the 21st Century, which was adopted by both countries in December 2006, Phil Goff said. It was carried out by independent private research institutes in both countries, with the support of both governments.

“This study is a strong foundation from which our two countries can discuss the possibility of an FTA. We enjoy a highly complementary trading relationship and an FTA would be mutually beneficial. We also work closely together as longstanding friends on issues affecting the Asian region,” Phil Goff said.

Both countries rely strongly on trade, and are proponents of an open trading environment. New Zealand’s total trade with Korea was worth $2.7 billion in the year till June 2007.

“The study concluded that the growing and strongly complementary relationship shows that, under an FTA, consumers in both countries stand to gain from increased opportunities for trade, investment, knowledge transfer, and the productivity gains that come from a closer trade relationship.

“The next step will be for our two governments to meet in April to explore the study’s findings with the researchers and to consider what actions should follow.

“This meeting will provide an early opportunity for discussing further ways of enhancing the Korea-New Zealand relationship, following President-elect Lee Myung-bak’s administration officially taking office next week,” Mr Goff said.