New-Zealand-land-of-long-white-cloud

New Zealand is a water rich country with a benign temperate climate positioned in the South Pacific on the Asian rim.  It is a stable OECD parliamentary democracy with well-established legal systems (based on the English legal system).

New Zealand ranks 1st equal as the least corrupt country in the world, Best Country for Business and 1st for Investor Protection, 1st on Absence of Protectionism, 2nd on Ease of Doing Business and 3rd on Economic Freedom.

The agricultural sector in New Zealand is free of production, export or tariff subsidies and the fact that New Zealand is able to compete against countries with such subsidies, augurs well for any trade liberalisation.

The Government in New Zealand has put in place a number of valuable free trade agreements (with China, Hong Kong, Singapore, Malaysia, Thailand, Brunei, Chile, Australia, and Taiwan), and has others under negotiation and expected to be completed (with India, Russia, Korea, Vietnam, ASEAN, Peru). The US President has indicated the US’ intention to negotiate entry into the “Trans-Pacific Partnership” or TPP free trade agreement that is in place between New Zealand, Chile, Singapore, and Brunei. Mexico, Canada and Japan have all also joined in the TPP discussions.

New Zealand’s free trade agreements and it’s low cost production will allow the primary sector to continue to flourish even in the absence of any major international trade liberalisation.

The competitive and comparative advantages New Zealand has are in producing dairy products, products that benefit from a premium positioning in the global cross-border trade. This along with its dominance in the globally traded dairy markets and the expected increasing global demand for such products (and especially from Asia) supports the expectation that New Zealand dairy investments will outperform other developed world agricultural investments. 

Sources:

Corruption Perception Index 2010, Transparency International
World Justice Project, Rule of Law Index 2011
Forbes Magazine, November 2012
IMD World Competitiveness Yearbook 2010
World Bank 2010
Fraser Institute 2010