NZ dairy’s China opportunity – can the growth continue?
A decade and a half after signing a Free Trade Agreement with China, New Zealand looks set to strengthen its commanding position in the giant economy.
Since the far-reaching agreement was signed in 2008, it has been an unequivocal success for the New Zealand dairy industry.
All up, dairy exports to the world generated nearly $26 billion in revenue in 2023 – or one in every four export dollars earned.
In total, the value of dairy exports has grown by 45 per cent over the past five years, with much of that growth driven by China.
Since 2008, milk powder exports to China have been tariff-free up to a so-called “safeguard” volume, which has been progressively increasing.
Our economic reports paint glowing growth in Chinese exports but notes demand will ultimately taper off early next decade. Based on those rosy numbers, we get to economically keep our head above the water, what isn’t considered is if Chinese demand slows and drops.
Surely the low price of oil internationally tells us that Chinese demand must have dropped considerably. With spluttering economic conditions, why are we assuming they’ll keep buying our products?
We also ignore how handing our technology and cows over to China has helped them build their own Dairy Industry that is getting closer to challenging our position.
We’ve sold the golden cow that made the golden eggs.
This all seems like an enormous economic gamble.
The debt the banks forced Farmers to rack up for dairy intensification has locked them into confidence games about future growth that are highly questionable.
The data out last week shows a feeble growth rate for China with a shrinking population. The impact of China’s one child policy has generated a demographics nightmare that dooms them and their huge speculative property bubbles are utterly unsustainable.
The Evergrande house of cards is about to collapse and China just halted short selling on their stock exchange.
PS – The millisecond the manufactured food industry can reproduce synthetic milk powder our economy suffers an Alpine Fault level rupturing.
John Key, the current Ambassador from China to NZ, put all our cows in one Beijing Paddock as an economic strategy during his decade of empowering Beijing in the South Pacific.
Welcome to New XiLand
Turns out that strategy has locked us into geopolitical subservience to our new Chinese Economic OverLords, much to the fury of our Political Masters in Washington.
As we scramble to detach from China, India keeps getting mentioned as our new saviour from an authoritarian regime with questionable human rights practices…
New Zealand to put ‘every single effort’ into getting free trade deal with India
A trade expert is sceptical about New Zealand’s ability to lock in a free trade agreement with India within three years.
Prime Minister Christopher Luxon made the ambitious commitment during the election campaign.
Now in government, the new trade minister, National’s Todd McClay, said locking in a trade deal with India within three years was possible.
…but is India a trading alternative from an authoritarian regime with questionable human rights practices OR is India another authoritarian regime with questionable human rights practices?
Arundhati Roy: The dismantling of democracy in India will affect the whole world
I thank the Charles Veillon Foundation for honoring me with the 2023 European Essay Award. It may not be immediately apparent how delighted I am to receive it. It’s even possible that I am gloating. What makes me happiest is that it is a prize for literature. Not for peace. Not for culture or cultural freedom, but for literature. For writing. And for writing the kind of essays that I write and have written for the past 25 years.
They have mapped, step by step, India’s descent (although some see it as an ascent) into first majoritarianism and then full-blown fascism. Yes, we continue to have elections, and for that reason, in order to secure a reliable constituency, the ruling Bhartiya Janata Party’s message of Hindu supremacism has relentlessly been disseminated to a population of 1.4 billion people. Consequently, elections are a season of murder, lynching and dog-whistling – the most dangerous time for India’s minorities, Muslims and Christians in particular.
It is no longer just our leaders we must fear, but a whole section of the population. The banality of evil, the normalisation of evil is now manifest in our streets, in our classrooms, in very many public spaces. The mainstream press, the hundreds of 24-hour news channels have been harnessed to the cause of fascist majoritarianism. India’s Constitution has been effectively set aside. The Indian Penal Code is being rewritten. If the current regime wins a majority in 2024, it is very likely that we will see a new Constitution.
It is very likely that the process of what is called “delimitation” – a reordering of constituencies – or gerrymandering as it is known in the US, will take place, giving more parliamentary seats to those Hindi-speaking states in North India where the BJP has a base. This will cause great resentment in the southern states and has the potential to balkanise India. Even in the unlikely event of an electoral defeat, the supremacist poison runs deep and has compromised every public institution that is meant to oversee checks and balances. Right now, there are virtually none, except a weakened and undermined Supreme Court.
…I’m not sure moving our trade from an Authoritarian Communist Regime that is committing cultural genocide and mass repression to a Racial Supremacist Fascist State that is committing hate crimes is really all that much of a win for New Zealand ethically.
Our trade is jumping out of the Chinese pan and into the Indian fire while our American Capitalist masters demand more heat.
Indian Religion = yay?
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From someone who has spent a reasonable amount of time in India, I suspect trying to extract any sort of FTA will be like pissing in the wind for a while yet. (I’ve no desire really to go back there in a hurry. while Modi is in power).
Despite the turmoil between religions (stirred up by the likes of Modi), there’s one thing Indians don’t like:
their countrymen being treated like shit offshore. NZ has a record of treating various Indian demographic classes like shit, ripping them off, and making life unnecessarily hard for them .
New Zealand trade delegates have been able to capitalise on gentrification, changing demographics that drive prices up, and lacks underwriting of loans that drive prices up. And bubbles that drive prices up. The plan was to gather a harvest and drive down taxes and government spending. Now I’m not good at math but I know that a massive sell off of the agri sector doesn’t equal 20 billion a year.
Now that we are seeing a reversal in demographics we have to begin the process of shorting or buying puts on any nation that trades with New Zealand. The government can’t do that but our big four banks can. Understand that these are political decisions. Governments can just change the rules instead of marking assets to market prices they can just make up a number so we have to use our own analysts and accountants so instead of the market saying what the value of our exporters are we can tell ourselves with a spreadsheet.
So someone go buys a farm for a million dollars but it’s only worth 500,000. Then say my spread sheet says it’s worth a million then go get a million dollar loan. We can’t do that, but the banks can do that. So. That will turn our exporters around from collapsing to growing.
Now these are political decisions that should come with a pay off for the the payer so if it’s negotiated in good faith then a 1% financial transaction tax can be implemented so our banks can go after black swans.
Is that other Indians, or Indians that have recently become NZ citizens, ripping off those people or our ministries?
Probably both. There’s a lot of Paula Bennett style ladder puller uppers out there.
Those that have ‘become’ NZ citizens justify it (rationalising it in their own minds) by thinking that because they had to suffer, it’s OK to do it to others. In Wellington, Neil and Monty, elsewhere – in Bay of Plenty orchids for example.
Messrs Treen, McCarten, Kaloti, McClymont and others are well familiar with it all.
It’s unacceptable whoever does it. Unfortunately our gummint departments and agencies have been enablers
I suspect rumours of China’s economic demise are somewhat premature and exaggerated. Idiots like Peter Zeihan have made a career out of this for over a decade. I’m still waiting.
If you want a more accurate assessment listen to Michael Hudson.
Money isn’t real they’re just made up.
Maybe it’s easier to blame China’s economic performance than acknowledge the we have helped them on their journey to more self sufficiency
With Evergrande having filed for bankruptcy yesterday and dozens of others set to follow, the Chinese economy is likely to face a cash worth ten times what the GFC was.
Many Chinese will likely be reduced back to a bowl of rice a day, if they’re lucky: They won’t be in a position to buy our overpriced kiwifruit and baby formula.
Anyone who thinks this won’t impact us is kidding themselves.
lol, imagine thinking that a serious government that actually doesn’t want an unsustainable property boom is going to be hurt by big developers going out of business and being nationalised.
It’s a pity you neoliberal freaks are in charge here. We could have affordable housing if we had a serious government.
A bowl of rice a day? Now that’s a worry!
The only way developing countries can become developed countries is via a bit of ‘authoritarianism’.
After all the social democratic countries did not achieve their current levels of enormous wealth by being nicey nicey. A lot of it was looted from countries like China and India
Well said Mark .Just look at Singapore now compared to 50 years ago.
It’s a great assertion – what proportion of European trade do you suppose was comprised of this “looting”? Have you looked at the numbers? Or is it, like the returns on the slave trade, an article of faith?
As for various indigenous groups, the maths are important. They put the actions and powers of colonial authorities into perspective.
Yeah bro, those hundred million Chinese who criminals from the Sassoon crime family got addicted to opium? Just a rounding error. Clearly the Chinese have no reason to be mad.
After the military research ship “Yuan Wang 5” belonging to the People’s Republic of China visited Sri Lanka, India-China relations began to deteriorate beyond repair. Finally, New Delhi accused Beijing of “militarizing the Taiwan Strait”. India, which is currently experiencing border tensions with China and therefore does not interfere much in Taiwan-related issues, made such a statement for the first time and openly criticized China’s military presence in the seas.[1] The most important reason for this is the recent arrival of a Chinese military research ship in Sri Lanka, which poses a direct threat to India’s national security.
In this incident that took place in July 2022, New Delhi put pressure on Sri Lanka to prevent this visit, which threatened its national interests in the southern seas; But he still couldn’t prevent it. At this point, India has raised its voice against China regarding the security of the Indo-Pacific region, which the USA has long wanted to draw to its side. Because the Chinese ship visiting Sri Lanka is equipped with large radar systems for space research and is thought to have the capacity to monitor India’s military bases. China claimed that the ship in question was conducting scientific research. In short, India suspected that the Chinese ship was monitoring its military bases.
Similar tension is also experienced in the Ladakh border region. In this context, China agrees to retreat 20 km as a result of negotiations with India after entering 40 km inside the border. As a result, 20 km of land is gained.[2] Feeling surrounded by the Indian Ocean after its northern border, New Delhi felt obliged to warn about the “Chinese threat” in the Indo-Pacific. India would not have made a statement in this direction if it did not concern it closely. However, he had to do this when he saw that the “Chinese threat” had reached the Indian Ocean. The situation in question has been an indication that the India-China rivalry has begun to spread from land to sea.
In the background of this tension in the seas; The reason lies in India’s failure to express its commitment to the “one China” principle after the tensions over Taiwan. Because India has not confirmed its commitment to this principle before the world public opinion for many years. However, after the visit of US House of Representatives Speaker Nancy Pelosi, many European states, including the G-7 and ASEAN countries, and even the USA, reiterated their commitment to the “one China” principle. Thereupon, Beijing asked New Delhi to reiterate its commitment to the ‘one China’ principle.[3] Beijing expected a statement from India in this direction in the first days of the visit; However, New Delhi remained silent in this process.
Due to India’s failure to confirm its commitment to the “one China” principle, the Beijing administration has begun to think that the security of its immediate surroundings is under threat. As long as India remained silent on this issue, China looked for “ulterior motives” in it. But New Delhi has many reasons to remain silent. The most important reason for this is the border disputes with China. While the Beijing administration claims rights on Indian territory, for example Aranuchal Pradesh; India should not be expected to support the “one China” principle.
In short, there is distrust between the two countries regarding respect for territorial integrity and sovereignty. Chinese; If India relinquishes its claims over disputed regions such as Kashmir, Ladakh and Aranuchal Pradesh and gives certain assurances in this regard, in return, India can make peace with China and confirm its commitment to its principles.
Indian External Affairs Minister Subrahmanyam Jaishankar said in a statement on August 18, 2022 that relations with China are at an “extremely difficult stage” and that there are “many reasons” for the two countries to work together. ] Responding to the comments in question, the Beijing Government said, “We hope that India will bring the relations to an early conclusion.” He decides to work with us in the same direction to put history on track.” made a statement.[5] Based on these words, India is the side that needs to “correct itself” in bilateral relations. Because in this statement, “I hope they will work in the same direction and cooperate with us.” It is said. However, India claims that it is China that acts aggressively on the border. As a result, there is a trust issue between the two countries arising from the border issue.
India has a generally reactive approach to China.
Source : https://www.ankasam.org/is-india-china-rivalry-moving-to-indo-pacific/?lang=en
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