A long-awaited free trade agreement between New Zealand and South Korea has been signed in Seoul by Prime Minister John Key and the Korean president, Park Geun-hye.
The deal with New Zealand's sixth-largest market for export products will make progressive inroads into the $229 million annual imposition of tariffs on New Zealand goods and services, mainly agricultural products, entering the South Korean market annually and had become urgent after competitors in the beef trade, Australia and Canada, had already signed such agreements.
The signing in Seoul coincided with the release to the New Zealand Herald of documents showing New Zealand's signals intelligence agency, the Government Communications Security Bureau, had in 2013 spied on efforts by South Korea to promote its Trade Minister, Taeho Bark, to become secretary-general of the World Trade Organisation, a position also sought by New Zealand Trade Minister Tim Groser.
Both the New Zealand Council of Trade Unions and anti-FTA campaigner Jane Kelsey criticised the new agreement, saying it eroded New Zealand sovereignty through its inclusion of investor-state dispute settlement terms without achieving the same degree of market access as was achieved in the Australian and Canadian FTA's with Korea.
"We need to ask why New Zealand is signing up to more ISDS provisions when we are fortunate to have relatively few of them. The answer may lie, once again, in the preoccupation with the agriculture parts of these deals without considering how real the gains are over how long and what trade offs are involved," Kelsey said.
Labour leader Andrew Little criticised the use of the GCSB to assist New Zealand's WTO bid, but Labour had issued no statement on the FTA by time of publication.
Estimated tariff reductions on a range of agricultural goods is estimated at $65 million in the first year of the agreement, which is expected to come into force this year following ratification by the New Zealand parliament.
Two-way trade between New Zealand and South Korea is currently worth around $4 billion annually. The FTA contemplates a 15-year phase-in period, at which point 98 percent of goods from New Zealand are estimated to enter South Korea duty-free.