Coleman Jonathan: Tariff (New Zealand-Hong Kong China Closer Economic Partnership Agreement) Amendment Bill — Second Reading In Committee Third Reading 
Coleman Jonathan: Tariff (New Zealand-Hong Kong China Closer Economic Partnership Agreement) Amendment Bill — Second Reading In Committee Third Reading 
[Volume:666;Page:13401] 
Hon Dr JONATHAN COLEMAN (Minister of Immigration)  
on behalf of the Minister of Trade 
: 
 I move  
That the Tariff (New Zealand-Hong Kong China Closer Economic Partnership Agreement) Amendment Bill be now read a third time 
. On behalf of the Minister of Trade I am pleased to move this third reading. The bill received its second reading and underwent its Committee of the whole House stage earlier today. It amends New Zealand’s domestic legislation so that the New Zealand - Hong Kong closer economic partnership is ready to enter into force as soon as the Hong Kong Government has completed its internal processes on it. 
The closer economic partnership agreement with Hong Kong is a further achievement in New Zealand’s trade agenda. It stands to deliver real benefits to New Zealand businesses by guaranteeing tariff-free entry into the Hong Kong market securing more certainty of access for our services suppliers and providing a framework for regulatory cooperation and consultation. It is the first free-trade agreement that Hong Kong has signed outside mainland China. 
New Zealand has been striving to secure a trading agreement with Hong Kong for a number of years including under previous administrations for several reasons. Firstly Hong Kong is an important business hub in Asia. Asia is increasingly important to New Zealand as a partner for regional trade integration and it is a growing market for our exports. New Zealand’s trade with the Asian region grew by 5 percent in the last 12 months and it represents a massive $15 billion in annual export earnings for this country. Secondly Hong Kong is strategically important as a platform from which New Zealand companies and products enter mainland China. This closer economic partnership complements our free-trade agreement with China which was signed in April 2008 and is already delivering substantial benefits. Together these two agreements deliver a golden opportunity for New Zealand businesses to launch or continue to expand into the growing and dynamic Chinese market. New Zealand will be the only country in the world to have free-trade agreements with both mainland China and Hong Kong. 
Hong Kong’s wealth of experience in doing business with China and its connections to the Chinese and other Asian markets are unrivalled. At the same time it has a legal system very similar to that of New Zealand and an open transparent business environment. This makes Hong Kong an excellent location for New Zealand businesses that are looking to launch into a complex and sometimes daunting Asian market. Hong Kong is a significant market in its own right. It is currently New Zealand’s ninth-largest export destination. Merchandise trade between our two economies has been growing at an average of 7.5 percent per year for the past 5 years and last year it was worth almost NZ$1 billion. 
The closer economic partnership locks in duty-free access for all New Zealand exports to Hong Kong. This is a significant advantage over other countries with which Hong Kong is able to raise tariffs on 14 percent of import lines at any time. In return New Zealand is committed to phase out tariffs on imports from Hong Kong according to a schedule that is identical to the phasing under our free-trade agreement with China. The closer economic partnership is not just about goods; it also creates improved access for New Zealand service providers to Hong Kong. New Zealand providers will benefit from greater certainty of access into the Hong Kong services market including private education business services environmental services and logistics. This access is also future-proofed under the most favoured nation clause. Any preferential treatment that Hong Kong accords to other trading partners in future agreements in particular sectors will automatically be extended to New Zealand services suppliers. The closer economic partnership also extends the benefit of any liberalisation that Hong Kong makes domestically to New Zealand services suppliers in some currently reserved sectors. 
Under the closer economic partnership New Zealand business people will benefit from the faster processing of applications for business visas and short-term business visitors will be able to get a 90-day visa. Other aspects of the trading environment such as customs procedures sanitary and phytosanitary measures technical barriers to trade intellectual property competition and e-commerce receive comprehensive coverage in the closer economic partnership. 
Alongside the closer economic partnership New Zealand and Hong Kong have also entered into a memorandum of understanding on labour cooperation and an environmental cooperation agreement. I would also note that contrary to Mr Russel Norman’s assertion that the side agreements on labour and the environment are not legally binding I can confirm that these agreements are in fact legally binding. These agreements complement the content of the trade agreement and reinforce issues of importance to both countries. 
As part of the negotiations New Zealand and Hong Kong have also agreed to negotiate a comprehensive investment protocol within 2 years of the closer economic partnership’s entry into force. Although it is envisaged that the investment protocol will provide strengthened disciplines and protections for investors there is no intention that the protocol will alter the categories of investment that are subject to screening under the Overseas Investment Act. 
In summary this closer economic partnership with Hong Kong brings about significant advantages for New Zealand. It establishes a clear certain and effective framework for New Zealand companies to operate in a dynamic and rewarding market. It also complements our ground-breaking free-trade agreement with China. In other words we now have an unparalleled opportunity to increase our exports to a region that will continue to be of central importance to our economy in both the short and long term. I acknowledge the efforts of the officials of former Ministers of Trade and also of the stakeholders who contributed to this excellent outcome. I also acknowledge and thank the members of the Foreign Affairs Defence and Trade Committee for their consideration of the Hong Kong closer economic partnership bill. 
This bill will amend the Tariff Act 1988 by inserting “Hong Kong China” into the list of preferential countries in note 3 of the Tariff. This is the only statutory amendment that is required to give effect to the closer economic partnership. Following this amendment other amendments by regulation will also be required in order to enable the application of preferential tariff rates under the closer economic partnership. 
Our prosperity as a nation depends on our ability to trade and invest on the world market. We also depend on there being robust rules to govern trade and remove barriers so that our traders can compete fairly. These goals are embodied in this closer economic partnership which will benefit New Zealanders and which is supported by the majority of members in this House. I commend the bill to the House.