Firms take cautious line on NZ-Chile trade

By Mark Reynolds

While there was plenty of talk during the Apec summit about the prospect of a free-trade agreement between Chile and New Zealand, it could be some months before the politicians are ready to sign any deal.

Similarly, the businesspeople from Chile and New Zealand who met on the sidelines of Apec are being cautious about cementing any firm deals.

About half a dozen businesspeople from the two countries met between sessions of the chief executives' sum-mit.

While the businesspeople were obviously keen to do business, there was watchfulness because some past deals between New Zealand and Chilean companies have had their hiccups.

One New Zealand businessman who met Chilean officials was Chris Liddell, the chief executive of forestry, paper and packaging company Carter Holt Harvey. His company has more than $2 billion tied up in Chilean conglomerate Copec. But the investment is subject to a dispute with Chilean partners over management rights for the assets, and other New Zealanders are concerned they could run into similar disputes.

Also present at the NZ-Chile business meeting were representatives from the Dairy Board, which has a 51 per cent share of Chilean milk products group Saprole. That company is a household name in Chile, with its brand second only to Coca-Cola in the country. But Saprole's dominance of the dairy products market has some Chilean farming groups worried, especially as some specialist products for the company are exported from New Zealand.

Ross Townshend, chief executive of meat company Affco, said he would be interested in making inroads into the Chilean market but he sensed there was some wariness by New Zealand companies because of experiences with the likes of Carter Holt and the Dairy Board.

However, the general commitment in Auckland to continue the free-trade agenda would help to break down any barriers.

He said the move might be led by smaller rather than larger businesses. Companies such as Auckland-based engineering group Glidepath Ltd, which makes conveyor belts for airport baggage-handling systems, was one company that appeared to make some progress with the Chilean executives.