Trade rating drops after exporters hit barriers

Last year, New Zealand was ranked 10th out of 118 countries in the World Economic Forum's Global Enabling Trade Report.

But this year, the country's ranking dropped to 11th out of 121 countries after an export dimension was introduced into the report.

The report, which assesses and ranks countries based on their policies, institutions and services enabling trade, gave New Zealand the thumbs up for a "highly efficient and transparent border administration" and lauded the country for its low tariffs on agricultural products.

But it made note of the high barriers to exports.

New Zealand ranked a poor 115 out of 121 countries for the tariffs faced by exporters and the preference shown to New Zealand exports by the country's target markets.

"The country's regulatory environment is characterised by fairly good ratings on ethics and a low level of corruption, as well as an effective domestic competition policy, though obstacles still persist in hiring foreign labour and regulation of FDI (foreign direct investment)," the report stated.

It also said upgrading the infrastructure, particularly roads and rail, would help smooth the flow of goods both across borders and inside the country.

Business New Zealand chief executive Phil O'Reilly believed New Zealand's drop out of the top 10 was not significant as the country remained at the top end.

But the barriers to New Zealand's exporters were worrying.

"This reflects the general difficulty faced by food exporting nations, given the high barriers against food products in many parts of the world."

O'Reilly said the rating demonstrated the need for New Zealand to go forward and sign free trade deals and the importance of the Doha talks.

"If we can free that up - we can gain multilaterally, rather than singularly."

O'Reilly said the Government was already addressing some areas highlighted in the report, such as infrastructure and technology improvements.

But some of the weaker areas, such as support for innovation and training to help businesses into exporting, needed more work.

Singapore and Hong Kong were rated the highest in their ability to enable trade as a result of their openness to international trade and investment.

Report co-editor Robert Lawrence said enabling more trade was vital as it could help mitigate the effect of the global crisis.

HOW WE COMPARE

Top countries for trade*

1 Singapore

2 Hong Kong

3 Switzerland

4 Denmark

5 Sweden

6 Canada

7 Norway

8 Finland

9 Austria

10 Netherlands

11 New Zealand

14 Australia

16 United States

20 United Kingdom

*Out of 121 countries The high barriers faced by Kiwi exporters has seen New Zealand drop out of the top 10 countries in a global report on the ease of trade.