29 Nov 2012

NZ not winning war against tariffs

6:35 am on 29 November 2012

An updated report on barriers to horticultural exports shows New Zealand is not winning the war against tariffs.

The report estimates the total cost of tariffs imposed on New Zealand fruit and vegetable exports will top $240 million this year.

That's a slight increase on the $235 million reported two years ago.

Stephen Odgen, of Market Access Solutionz, which compiled the report for the Horticulture Export Authority and Horticulture New Zealand, said that cost estimate is conservative and it represents a significant loss to growers.

"And it's not shared evenly, there are big differences between, for example, the $5000 - $6000 per capsicum or summer fruit grower and $120,000 if you're a squash grower."

Mr Ogden said in terms of markets India has the highest average tariff at well over 45%, Korea is not far behind and then Taiwan is behind that.

Of the countries that New Zealand has free trade agreements with, he said there was already a tariff free status in some of the countries, or the tariffs have reduced as a result of the free trade agreements.

Trade Minister Tim Groser said horticultural and agricultural tariffs remain an extremely important trade issue for New Zealand despite the views of some economists who question their significance.

"We face massive tariff barriers actually, New Zealand is probably more effected than any country in the world by tariff peaks, which are concentrated in agriculture, the solution to which can only come through successful trade negotiations."

He said the report shows that New Zealand's 5500 growers suffer an average income loss of $44,000.

Despite tariffs and other trade barriers, the value of New Zealand fruit and vegetable exports continues to rise, reaching $2.3 billion this year.