The Closer Econonic Partnership (CEP) between Hong Kong and New Zealand became effective on January 1, 2011 and is expected to boost trade between the two countries.
Under the CEP, New Zealand products currently entering Hong Kong at a zero tariff will be bound at that level. New Zealand will phase out over six years its import tariffs on all goods originating in Hong Kong. Upon complete elimination of New Zealand's tariffs, Hong Kong's annual tariff saving is estimated to be about HK$7 million (US$900,000) on the basis of average merchandise trade figures from 2006 to 2008.
On trade in services, Hong Kong service providers and the services they provide will enjoy secured preferential opportunities in the New Zealand market in a variety of service sectors. The agreement encompasses sectors including maritime transport services, logistics and related services, audiovisual services and various business services, computer and related services, management consulting services, and services incidental to manufacturing. It also includes the six industries where Hong Kong enjoys clear advantages and the need to promote their further development was identified in the 2009-10 Policy Address, namely, education services, medical services, testing and certification services, environmental services, innovation and technology, and cultural and creative industries.
In terms of market access, restrictions in the form of limitations on foreign capital, number of service providers or operations, value of service transactions, number of persons employed, types of legal entity or joint venture requirements will be eliminated in a variety of service sectors in the New Zealand market. Hong Kong service providers and the services they provide in a wide range of sectors will be treated no less favourably than their New Zealand counterparts in similar circumstances. They will also automatically enjoy more liberalisation measures which New Zealand undertakes in its future FTAs with other trading partners.
On movement of business persons, without compromising legitimate immigration control, business persons of the two economies in the categories of business visitors, intra-corporate transferees, and installers or servicers in specified service sectors will be granted temporary entry into Hong Kong and New Zealand under favourable conditions.
On investment facilitation, to further enhance bilateral investment flows, the two sides have agreed to negotiate an Investment Protocol to the CEP Agreement, with a view to concluding the investment negotiations in two years' time after the CEP Agreement has entered into force. The investment negotiations will cover elements that aim to enhance the promotion and protection of investments between the two economies, including non-discrimination, fair and equitable treatment, and full protection and security.
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