StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Impact of Free Trade Agreements on New Zealand Economy - Dissertation Example

Cite this document
Summary
The paper "Impact of Free Trade Agreements on New Zealand Economy" highlights that when mutual tariffs are eliminated in all sectors between China and NZ, it would likely to increase in welfare for NZ by US$ 160m per annum whereas it is likely to reduce the welfare for China by US$22 m…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER96.5% of users find it useful
Impact of Free Trade Agreements on New Zealand Economy
Read Text Preview

Extract of sample "Impact of Free Trade Agreements on New Zealand Economy"

Download file to see previous pages

 FTAs will likely result in tariff minimisation in the majority of the products traded between the nations.

This research paper will endeavour to examine whether FTAs entered by New Zealand (NZ) with Australia, China, and ASEAN has helped the NZ economy to grow further or not and whether NZ derived many benefits from such FTAs like employment creation, technology transfer, increased standard of living, simplification of customs procedures, trade expansion and overall economic growth by investigating into the earlier empirical evidence available on the subject and statistics offered by the respective governments.

When two or more nations eliminate tariffs against products emanating within these nations is known as a Free-trade agreement. (FTA). Under FTA, each nation has the right to maintain its own tariff and the privilege to administer its own trade policy thereby resulting in shallow integration. (Goode 2005:1).

If a New Zealand (NZ) manufacturer found a buyer for his product in Australia, and the Australian importer has to pay a tariff of 20% meaning for $100 product imported from NZ, an Australian has to pay $120 ( cost of material + tariff). However, under NZ and Australia FTA agreement, these products can enter into Australia without tariff and vice-versa. The preferential tariff rates under FTA make NZ products cheaper for Australians. The elimination of tariff offers the NZ, a competitive benefit over other nations that do not have FTA with Australia.

Thus, FTAs make NZ producers and exporters more competitive both abroad and domestically. (“Renda, 2013, p.1”). An FTA has the following advantages: Safeguards NZ investments in the partner’s nation Offer new market access for NZ manufacturers and consumers Offer market access to remanufactured products Trade-in-services will get a fillip Offers advantages to medium and small exporters of both the nation Enhances custom facilitation (Garnaut, 2002, p.125). If we analyse the economic growth rates of nations that have FTAs with the developing nations, as indicated by GDP, we can find that in many cases, it has surpassed those of advanced economies.

NZ companies exporting to Australia enjoy double benefits with ever-growing consumer bases and low tariff rates. In spite of the recent global economic crisis, FTA has facilitated many small nations to sustain the growth and to maintain the same in the coming years also whereas advanced economies are in turmoil. (Barry, 2012, p1). 1-2 History of Free Trade Agreements As per Dent (2007), the regionalised and imperial trade arrangements that existed between the Middle East, China, Europe and India have given birth to the international trade systems.

...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“International Business (international trade) the title of the research Dissertation”, n.d.)
International Business (international trade) the title of the research Dissertation. Retrieved from https://studentshare.org/macro-microeconomics/1471514-international-business-international-trade-the
(International Business (international Trade) the Title of the Research Dissertation)
International Business (international Trade) the Title of the Research Dissertation. https://studentshare.org/macro-microeconomics/1471514-international-business-international-trade-the.
“International Business (international Trade) the Title of the Research Dissertation”, n.d. https://studentshare.org/macro-microeconomics/1471514-international-business-international-trade-the.
  • Cited: 0 times

CHECK THESE SAMPLES OF Impact of Free Trade Agreements on New Zealand Economy

Free trade is the primary force driving economic development

In most of the cases countries that have participated in free trade agreements have experienced rise in living standards, growth in income.... This growth curve experience by several countries due to free trade agreements is clear indication of the importance of free trade agreement in economic development.... Although many developed countries are still practising protectionism, they have realised the importance of free trade in economic development....
11 Pages (2750 words) Essay

Trans-pacific Partnership

This meeting of the APEC body took place in Lao Cabos, Mexico, and some of the prominent leaders who participated in this meeting were Ricardo Lagos, the President of Chile; Goh Chok Tong, the Prime Minister of Singapore; and Helen Clark, the Prime Minister of new zealand.... They original TPP agreement was signed on 3 June 2005 by Chile, Brunei, Singapore and new zealand and was enacted on 28 May 2006.... It has been decided that the 15th round of TPP negotiations would be held in December 2012 it Auckland, new zealand (“Trans-Pacific Partnership (TPP): 15th Round of TPP Negotiations Set for Auckland, new zealand -- December 3-12, 2012”)....
6 Pages (1500 words) Research Paper

New Zealand Economy

The dependence on new zealand's growth leaves it vulnerable to economic performance in the market.... new zealand is an island nation in the southern Hemisphere.... The Polynesians were the first people to settle in new zealand.... new zealand is an island nation in the southern Hemisphere.... The Polynesians were the first people to settle in new zealand.... The new zealand people are the descendants of European immigrants and native people of Maori....
7 Pages (1750 words) Essay

Free Trade Agreement

A free trade area is formed by free trade agreements.... However, there has been some opposition to the establishment of free trade areas also.... here are other difficulties in the establishment of free trade areas.... It is also negotiating with Australia and new zealand for the establishment of an FTA.... This paper describes a free trade agreement.... Countries that eliminate tariffs and quotas create a free trade area where preference is given to most goods....
8 Pages (2000 words) Coursework

Free Trade Agreement in China

The previous discourse regarding whether trade agreements have proved to be a success mode or a tentative block for international trade liberalization has developed into a meticulously relevant subject matter today where East Asia's biggest.... Currently, China is analyzing, negotiating, or applying Free Trade agreements or FTA with over 20 nations and regions.... This significant progress in China's al or economic mediation has caused other nations, chiefly the ones in Asia Pacific region, to go abroad on preferential trading agreements, thereby, causing consideration from the World Trade Organization regarding the propagation of prejudiced trade agreements (Jiang, 2008)....
13 Pages (3250 words) Essay

Benefits of Free Trade

For instance, when a pressure group asks for protectionism, the government can safely reject it on the basis of free trade agreements.... The focus of this paper "Benefits of free trade" is on free trade, a branch of globalization that is governed by a treaty between two or more countries to establish a free trade area where goods and services can be exchanged and served across its common borders, without tariffs or hindrances.... Based on the paper, free trade has been beneficial to countries involved; however, the extent of benefits in these countries cannot be measured....
5 Pages (1250 words) Essay

International Business Environment: Free Trade Agreement

The paper focuses on free trade agreements which reduce trade barriers and ensures easy exchange of goods.... However, there has been some opposition to the establishment of free trade areas also.... It is believed that a free trade area increases income and wealth.... Countries that eliminate tariffs and quotas create a free trade area where preference is given to most goods.... The prerequisite for the free trade area is if the economic structures of the participating countries are the same....
8 Pages (2000 words) Term Paper

Regional Trading Agreements

Looking at the advantages and limitations of free trade in the region, the member countries in the region of East Asia have undertaken changes in their policies for entering into regional trade agreements.... The mutual co-operation between the member countries in encouraging free trade is expected to attract the investors to take advantage of the economic incentives in the form of taxes and tariffs as agreed under the agreement of free trade.... The rationale behind the adoption of regional trade agreements has been due to the need of revival of the economy from The present research has identified that the motives behind the adoption of regional trade agreements have been also to revive the stagnancy in the economies....
11 Pages (2750 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us