China and New Zealand will start negotiation over upgrading the existing free trade agreement (FTA) in next month, Chinese Premier Li Keqiang and his counterpart Bill English announced in a joint press conference on Monday. The highly anticipated decision came amid Li's ongoing two day trade tour to New Zealand.     

Like Us on Facebook

The setting of a fix time schedule to start talks over FTA was high on New Zealand's agenda as it wants more access to Chinese market for its products.

Apart from FTA talks, Li and bill signed several important trade agreements, including the one that will allow New Zealand's more meat processors to export chilled meats to China. However, initially only 6 out of the agreed 10 meat processors will be allowed to export on trail basis and others will soon follow the suit if the trail is successful.       

Both leaders also signed an agreement to increase the number of direct flights between China and New Zealand from existing 49 to 59.

Later in the conference, Bill hoped that the upgraded FTA will allow New Zealand to export more diary and health related products to the Asian country. The New Zealand leader termed the nine year old deal as a huge success that helped to triple the trade between the two countries. He said that upgraded agreement will help to boost the two way trade to $30 billion by 2020.

Some sensitive trade issues also emerged during the talks, including the critical issue of steel dumping that drew the ire from New Zealand's several steel manufacturers last year. But the Chinese leader during the conference flatly denied any steel dumping done by his country.

In defence, he compared China's over-export of steel products with New Zealand's huge export of dairy products.

"China is not dumping steel products in New Zealand. Likewise, 50 percent of China's dairy product imports are from New Zealand but we haven't said New Zealand is dumping dairy products in China," Li concluded.    

China and New Zealand trade issues overshadowed by political issues

While China and New Zealand's trade ties boomed since the signing of FTA in 2008, but conflict over political issues have become a major irritant in their trade ties. The conflicting views especially over South China Sea dispute, over which New Zealand has sided with the U.S., has been the main bone of contention between the two countries.

According to reports, Bill did brought the South China Sea issue with Li during the meeting, stating that his country's view on the disputed maritime territory remains unchanged.    

Last year, Chinese state media had to warn New Zealand's Former Prime Minister John Key not to discuss the South China Sea issue during the China visit.

TagsChina and New Zealand, new zealand, china, Li Keqiang