NZ can benefit from Australia-US trade agreement says Cullen

SYDNEY - New Zealand could benefit from an Australian free trade agreement (FTA) with the United States, Finance Minister Michael Cullen said here today.

He told a Trans-Tasman Business Circle breakfast that New Zealand did not regard Australia's attempt to get an FTA as in any way unfavourable to New Zealand.

Australian trade officials are in Hawaii negotiating the early stages of an FTA with the United States.

Dr Cullen acknowledged New Zealand was further away than Australia in terms of getting an agreement with the US.

"Ours of course is much slower as one might anticipate."

He said that while some sectors of the New Zealand economy may lose some advantage through a US-Australia deal, it was not likely there would be free trade in agricultural products between those two countries from year one.

"But if the Australian economy is able to grow faster as a consequence of the FTA then that will help NZ because Australia is by the far our most important investment and trade partner and we expect that to counteract any other trade or investment diversion.

"It is doubtful there would be any significant trade diversion, maybe some investment diversion.

"We will continue to push at the door ourselves as we talk to those in Congress who are friendly to us."

"I think both of us (Australia and New Zealand) mustn't lose sight of what is the much more important objective of a multilateral trade round in Doha."

He said the biggest gainers of full-scale trade liberalisation would be the European community through ending the "insane distortion" of their own market and fiscal position.

"I think we need to get that message across to their people as strongly as we can."

- NZPA