New Zealand to double exports, grow tourism traffic to PH

MANILA, Philippines – New Zealand aims to double its exports to the Philippines to NZ$1.5 billion ($1.3 billion) by 2025, and pushes for more tourism traffic to the Southeast Asian nation.

New Zealand Ambassador to the Philippines Reuben Levermore said the country’s exports to the Philippines amounted to about NZ$750 million ($649.10 million) in 2013, up 13.4% from previous year. Of the exports, 71% were dairy products.

The Philippines is New Zealand’s second-largest market for dairy products after China. Revenues from dairy exports to the Philippines grew 24% in 2013, indicating high demand.

The goal is to double the exports as part of New Zealand’s overall target to raise the share of agriculture exports to 40% of its Gross Domestic Product, New Zealand Embassy Trade Commissioner Hernando Banal II said.

The two countries enjoy bilateral trade relations under the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA). The agreement calls for nearly all tariffs to be eliminated over time, phased to zero by 2020.

Two-way trade between the countries stood at NZ$897 million ($777 million) in 2013.

Levermore said the Philippines could do more to grow exports to New Zealand that stood at about NZ$150 million ($129.91 million) last year.

“(Philippine exports) do not have to be just bananas,” he said.

‘New Zealand is not just about dairy’

The Philippines is New Zealand’s 22nd largest trading partner behind Singapore, Malaysia, Indonesia, Thailand, and Vietnam.

Food and beverage products remained the biggest New Zealand exports to the Philippines, growing 11.3% annually.

Dairy products such as milk powder, cream, butter and cheese, which are used for food processing, accounted for a large majority of total exports to the country in 2013.

In recent years, New Zealand has also noted a shift in Philippine market preference from low-value commodities like dairy powder, to high-value ones like yogurt and ice cream.

Levermore said the current two-way trade revenues between the countries could be NZ$1 billion ($866.1 million) if service exports of the Philippines were included.

The growing trend in New Zealand is for IT companies to tap call centers and outsource jobs, generating foreign exchange for outsourcing-oriented countries like the Philippines, he noted.

A recent trade mission yielded new agreements in technical and consulting services related to geothermal energy, IT, and healthcare systems.  

Philippine companies, for their part, also use New Zealand expertise to grow their businesses.

He cited, for example, General Santos City-based Alliance Select Food International, which uses New Zealand technology from joint venture partner Prime Foods NZ to process and export New Zealand salmon across Asia.

New Zealand technical expertise also contributed toward the eventual construction of the Philippines’ first geothermal plant, Levermore said. “New Zealand technology and expertise aligns very well with Philippine scale.”

He also said that New Zealand small and medium enterprises have also contributed in the development of mobile apps, secured payment systems including credit card payment gateways, and geotechnical services utilized for undersea mapping, exploration, dam safety, and disaster hazards/mitigation. These New Zealand firms train local employees in the use of these services, ensuring the transfer of technology and knowledge to Filipinos.

“In order to encourage further two-way investment, it is important for businessmen from New Zealand and the Philippines to visit each other’s countries to gain a closer understanding of the business environment and potential,” Banal said.

More tourism traffic

The Philippines was New Zealand’s 12th largest tourist destination in 2013.

But air traffic between New Zealand and Philippines was estimated at only 25,000 with 15,000 inbound to New Zealand and 10,000 inbound to the Philippines.

Levermore said inbound tourists to New Zealand are mostly family members and relatives visiting Filipinos residing there. “We need more New Zealand (citizens) to come to the Philippines.”

Connection between the two countries have to be improved because currently one has to fly to a third country like Singapore, Hong Kong, and Australia.

Carriers are being encouraged to fly directly and serve the growing number of Filipinos living in New Zealand which doubled in the past 6 to 7 years, Levermore said.

He did not provide the numbers but said Filipinos are the largest community from Southeast Asia that live in New Zealand.

The Philippines and New Zealand in March this year completed their first round of negotiations for air services which would pave the way for more flights.

“It’s up to the airlines to decide,” Levermore said.

In April, budget carrier Cebu Pacific lodged an application before the Civil Aeronautics Board to be allowed to launch 7 weekly direct flights to New Zealand. – Rappler.com