1. Economy—Diversification Resilience and TradeCHRIS BISHOP (National) to the Minister of FinanceORAL QUESTIONSQUESTIONS TO MINISTERSEconomy—Diversification Resilience and Trade1. CHRIS BISHOP (National) to the Minister of Finance: What impact is trade diversification having on the resilience of the economy?Hon STEVEN JOYCE (Minister of Finance): New Zealand's increasing trade diversification has been highlighted through the recent increase in overall exports from $67.5 billion 2 years ago to over $70 billion now despite a $3.5 billion fall in dairy exports over that period. Since 2007 since the figures for both goods and services exports have been available there has been good growth in exports across a diverse range of sectors. Although dairy exports have increased 49 percent since that time 10 years ago international education has increased by 70 percent commercial services by 54 percent and tourism by 32 percent. Exports of both fruit and wine have more than doubled. This increasing diversity adds to the resilience of the New Zealand economy.Chris Bishop: How has the destination of New Zealand's export trade changed over time?Hon STEVEN JOYCE: A key part of the economy's resilience is the increased diversification of New Zealand's trade destinations. Back 50 years ago less than 30 percent of our goods exports went into Asia; whereas in the last 2 years this has increased to nearly 60 percent with a significant shift occurring over the last decade. The most obvious example of this shift is the expansion in our trade with China which has moved from being our fifth- to our second-largest export destination over the last decade. But other countries have also grown significantly in importance as well such as India from 17th to seventh; Hong Kong from 15th to 10th; and the United Arab Emirates which has moved from 21st to 16th.Chris Bishop: What has been the impact of growing trade with China?Hon STEVEN JOYCE: As I noted in my previous answer China has moved from being our fifth- to our second-largest export destination since 2007. Exports of goods and services to China have more than quintupled over this time from $3 billion to $12.3 billion. Although this has been driven significantly by primary sector exports there has been a strong growth in services trade and as shown by the increasing interest in New Zealand from Chinese tourists this growth should continue. It is very valuable particularly in regional New Zealand. The Government has worked hard to foster a strong relationship with China and the visit of Premier Li Keqiang next week is an opportunity to further strengthen that relationship.Ron Mark: How on earth can he have such a rose-tinted view of our economy when manufacturing is in the doldrums we are importing unskilled migrants as workers and merchandise trade exports have fallen by a massive $725 million in the past year alone?Hon STEVEN JOYCE: I think the member has obviously got out on the wrong side of bed today. The New Zealand economy Mr Mark is one of the fastest growing in the OECD right now which is a tribute to New Zealand exporters particularly in regional New Zealand and places like the Bay of Plenty with the kiwi fruit and like Hawke's Bay with its apple industry and the wine industry and the growth in the meat industry—further opportunities there. A big part of it is the relationship with China which this Government is proud of fostering and that has seen very big increases in exports from the regions and incomes to the regions.Chris Bishop: What risks may impact on New Zealand's ongoing trade success?Hon Simon Bridges: The Opposition.Hon STEVEN JOYCE: Well apart from Mr Mark for most of the post - World War II period global trade has risen roughly twice as fast as global growth as a whole and has actually driven global growth. This has slowed a lot since the global financial crisis and recent OECD data suggests that trade growth is now slower than global growth. In this context New Zealand exporters have done particularly well and although the value of our exports is growing it remains a tough operating environment for exporters. Trade disruption and protectionism propose further risks to our success and that is why this Government will stay at the absolute forefront in advocating for free and fair trade.