YANGON - Myanmar's economy is slowly emerging from the crippling effects of decades of military rule, where a poorly-managed resources industry dominated much of the country's trade. The Aung San Suu Kyi-led government is encouraging foreign and local investment in job-creating export industries, with a strong focus on manufacturing. Boosted by U.S. President Barack Obama's recent removal of executive sanctions on Myanmar, the country's garment industry is on the rise, and aims to be the nation's largest employer.

The NLD-led government hopes new factories can provide employment for hundreds of thousands, whose education and work opportunities were stunted under 50 years of military rule.

Exports have almost doubled in the last five years, to $1.1 billion for the 2015 financial year when, according to the United Nations' International Labor Organization (ILO), the sector employed 380,000 people, mostly women.

The government recently passed an investment law that allows tax breaks for investment in the industry, while the U.S. dropped longstanding sanctions in September that will give international firms greater confidence in dealing with Myanmar.

The Myanmar Garment Manufacturing Association estimates the industry will employ up to 1.5 million workers by 2024.

"So with all these interests, the will of the government side, and the lifting of the sanctions, and the private sector also, the garment sector also the will grow," said Khine Khine New, secretary general of the association.

However, many problems persist.

An inexperienced government has been slow on detailing policies that give businesses the predictability they need, said factory owner Sai Maung.

While his company has benefited from foreign help to meet international labor and production standards, many factories are still coming to grips with Myanmar's transition.

"Before we are closed, but now we are moving to a democratic country and the people have no experience at all, I mean with how to deal with the issues," said Maung.

Industrial relations are struggling to keep up with pace of growth, according to ILO deputy liaison officer Piyamai Pichaiwongse.

"Myanmar was never a country that was operated by the rule of law. So therefore, the law does not have supremacy in anything that they do. There is not the reference for things that they do in the past," she said.

The ILO is working with the government to rewrite labor laws.

In the meantime, strikes have increased since a minimum wage of just $2.75 a day was introduced last year. Unions complain of increased persecution of their members, workers have little understanding of their rights and employers are struggling with compliance.

With an industry on the rise, these relations hold the key to improving the living standards of hundreds of thousands of workers and their families.

Beef and lamb exports fell in November, as the amount of meat sold dropped heavily compared with last year’s record season, Statistics New Zealand said today.

Meat and edible offal exports fell $158 million (31 percent) from November 2015, contributing to a $219 million (5.4 percent) fall in overall exports.

Beef exports fell 41 percent in value and 31 percent in quantity, and lamb exports fell 27 percent in value and 23 percent in quantity.

“Beef exports to the United States, our top beef export destination, fell by around half when compared to November last year” senior manager Jason Attewell said. “When compared to the same month of the previous year, the value of beef exports to the US have fallen in nearly every month since October 2015, only rising once in April 2016.”

Lamb exports to the European Union (our top lamb export destination) fell in November 2016, with the United Kingdom seeing significant falls in value and quantity.

After removing seasonal effects and irregular movements, meat exports have fallen 31 percent from their peak in September 2015. The fall was mainly due to lower quantities, but lower prices also contributed.

Total exports in November 2016 were $3.9 billion, while imports were worth $4.6 billion.

Seasonally adjusted exports in November fell almost 12 percent from October 2016, more than reversing a 9.3 percent gain in the previous month. Seasonally adjusted imports fell 9.0 percent in November after a slight rise in October.

The monthly trade balance was a deficit of $705 million (18 percent of exports). For the year ended November 2016, the annual trade deficit was $3.2 billion.

One of the striking things about New Zealand in recent times has been the deepening disconnect between our traditional security partners, and the trading partners that increasingly underpin our prosperity.

50 years ago security and trade went hand in hand. Then things started to change with the UK joining the EU. NZ had to seek new partners, new arrangements, and new friends.

Things have greatly improved over the last 30 years

Partly thanks to some welcome – though very slow – agricultutal policy reform in the EU and US.

But also due to the opening of massive new markets on our doorstep in Asia which really want, and are prepared to pay good money for, our products.

China’s entry to the WTO was arguably the biggest event in trade policy in last half century – and even overshadows the importance of the NZ/China FTA

The reality of the last 20 years has been the contrast between the closed and protectionist economies of Europe, North America and Japan, and our new trading partners in the east

China and most of Asia (with the exception of India), as well as much of the developing world, are more open to what we want to sell than our traditional friends.

At least in the primary products that still make up for more than half of our exports

Less than 3% of our dairy trade goes to the EU today

And now, to cap it all, our traditional friends, who built the post-war trading system, seem to be losing their appetite for globalisation.

Trump, Brexit, TPP.

So NZ finds itself in a very challenging place. Axis of tension indeed.

The fact of the matter is – we are an increasingly lone voice in advocating trade liberalisation.

We are a ‘shag on the rock’ in the global trading environment.

Even with all the negotiating success NZ has enjoyed, we now have FTAs with markets that cover 52% only of our current exports.

In the dairy world I know best, only 13% of global dairy demand is open to trade in the sense of tariff rates of 10% or less.

So what’s next?

In an uncertain, dynamic and even alarming world, rather than picking friends from one side or the other, NZ will instinctively revert to our traditional and deep-seated preference for multilateral – ideally global – solutions and institutions.

We still love the WTO, despite all the competition from competing regional and international bodies.

We would love to see the WTO make a comeback, ideally with NZ helping that to happen.

I am personally confident that our future will very largely evolve in the context of some sort of open, rules-based multilateral trading frameworks.

But what is not clear is whether these new arrangements will continue to hew quite so strongly to the Bretton Woods institutions and approaches that have provided the foundation of international trade since the second world war – the GATT, the WTO, FTAs themselves.

Or whether we will collectively develop something different. Something perhaps much more Asian in style, and approach. Perhaps something Chinese.

That would be interesting.

This post is an abridged version of a speech delivered to the NZIIA Global Future Conference. Read the whole speech here.

|  A TradeWorks Guest Opinion piece from  Philip Turner, Director of Global Stakeholder Affairs, Fonterra |  Dec 14,2016  |

New Zealand travellers will be able to fly all the way by A380 from Auckland and Christchurch to Morocco from late March next year when Emirates upgrades capacity on the service.

Emirates, voted the World’s Best Airline in the 2016 Skytrax World Airline Awards, announced today that it will operate the first ever commercial Airbus A380 flight to Morocco and North Africa, when it takes the iconic double decker aircraft to Casablanca daily from 26 March 2017.

The airline’s flagship aircraft, which continues to excite travellers and aviation enthusiasts alike, will replace the daily Boeing 777-300ER aircraft currently used on the Dubai-Casablanca route, offering increased seat capacity across all three cabin classes and an enhanced premium product experience.

All five daily Emirates A380 services from New Zealand will provide a direct connection at Dubai with the Casablanca flight.

The switch to the A380 offers a total of 1834 additional seats per week, meeting a growing demand from travellers.

Casablanca has become one Emirates’ most popular destinations, and has seen steady growth since the service launched in March 2002. Passengers travelling on the three-class, 491-seat aircraft, will enjoy spacious cabins and experience a peaceful journey in the world’s quietest long-range jet. They can use the onboard Wi-Fi; indulge in food prepared by international chefs, and be entertained by Emirates’ award-winning ice system which offers over 2,500 channels of inflight entertainment across all cabins.

Emirates is the largest operator of the Airbus A380, and has carried over 65 million passengers on its flagship aircraft since 2008.

So far, Emirates has introduced A380 services to over 45 destinations across its network. Its current fleet of 88 A380s has visited over 64 airports, flew nearly 986 million kilometres, and made 74,263 return flights to date.

|  An Emirates release  |  Dec 21, 2016  |

The Mandaue Chamber of Commerce and Industry (MCCI) has a lot on its plate as it gears up for at least four trade missions across Asia and the Pacific in 2017.

Glenn Soco, MCCI president, said they plan to send delegates to explore business and investment opportunities in Laos in Cambodia, Australia and New Zealand, Ayabe in Japan, as well as Thailand next year.

“Laos is a new frontier as their country is opening up to foreign investors. They are keen on building stronger trade with the Philippines also,” he said in a text message to Cebu Daily News.

In the same manner, Soco said they are also exploring opportunities with Australia and New Zealand as well as learning from their best practices.

The chamber leader said this was discussed when the Australian-New Zealand Chamber of Commerce of the Philippines (ANZCHAM) joined an investment forum in Mandaue City last August.

He cited governance and ease of doing business, particularly securing business permits, as among the things practiced in Australia and New Zealand that the Philippines can emulate.

Soco said it takes an average of one day to process business permits there while it takes an average of three years in the Philippines.

“If (the trade mission) really happens, we’d like to bring with us local government officials also,” he said.

New Zealand - Australia

Soco said the chamber is also interested in New Zealand and Australia’s “incubator” for micro, small, and medium-scale enterprises (MSME) since the empowerment of these businesses is among MCCI’s advocacies.

In 2017, he said the MCCI will strengthen this advocacy by pursuing initial discussions with the Cebu provincial government on crafting programs for MSME development.

Soco added that the Mandaue City government is also going to sign a sisterhood agreement with Ayabe in Japan.

“We also want to see trade and investment opportunities there. Likewise, we support the local government unit on this development,” said Soco.

He said that Ayabe government officials, during their visit to Mandaue earlier this year, mentioned that they needed skilled workers for their different industries.

There was also an invitation to MCCI from Thailand’s Trade and Investments Bureau, Soco added.

He said they have been asked to mount a trade exhibit there, although details have not been finalized yet.

Soco said the chamber is planning to launch these trade missions beginning in the first or second quarter next year.

Among the industries in Mandaue City expected to benefit from these trade missions are the food manufacturing segment, motor parts, and furniture, he added.

“I think Mandaue is positioning itself as a high-value manufacturing city. Manufacturing, being the biggest industry here, we are looking for buyers, trade with other countries, sourcing of raw materials, and exchange of information,” said Soco.

The business leader also said that the chamber will revisit its ties with Vladimir and St. Petersburg since President Rodrigo Duterte is moving toward stronger relations with Russia.

Since MCCI has participated in several trade missions in China, it will also review past agreements and initiatives to see where the group can capitalize or how it can align with the administration’s present thrust.

“It is important to prepare for the good things yet to come,” said Soco.

|  CBUDailyNews  |  Dec 19, 2016  |

India plans to take a longer period to eliminate tariff with China to give the domestic industry enough time to adjust to a trade deal with China. 

New Delhi:India plans to offer tariff elimination on more than 70% traded goods with China over an extended period of time under the ongoing negotiations for a Regional Comprehensive Economic Partnership (RCEP) agreement.

“One cannot go beyond 6% offer on either side of common concession. For example, if common concession is decided at 80% for all countries, then we cannot offer China tariff elimination of less than 74%,” a government official said, requesting anonymity.

The common concession of tariff lines is the minimum tariff elimination that a country has to offer under RCEP, which is yet to be finalized. India plans to take a longer period to eliminate tariff with China, say up to 30 years, to give the worried domestic industry enough time to adjust to a trade deal with China.

Steel industry is particularly worried as China has been dumping iron and steel products in India at a much lower price than the domestic industry can supply at. India has often resorted to anti-dumping measures to protect domestic industry from the onslaught of cheap imports from China.

“Other countries want a shorter phasing out period of tariffs; we want a longer phasing out period. Others say what you give to one country, you have to give to everybody, which we don’t agree to,” the official said, pointing at the current level of discussions at RCEP among member countries.

| Continue to orginal article  |  Dec 19, 2016 |

On Nov 21, United States President-elect Donald Trump said in a short video message that he would move to withdraw "on day one" from the Trans-Pacific Partnership (TPP), the US-led 12-member deal that excludes China and covers 40 per cent of world GDP and one-third of world trade.

He considers TPP a potential disaster and said: "Instead, we will negotiate fair, bilateral trade deals that bring jobs and industry back onto American shores."

Trump's position confirms his central campaign pledge of focusing on "America First", which may imply that the US-established world order is close to its end after 70 years.

Hong Kong should seize the day if Trump opts out of TPP.

However, China is in a different position.

China became a member of the World Trade Organisation in 2001 and since then has deeply integrated itself into the world economy.

In 15 years, China's total GDP grew nearly tenfold and jumped from the world's sixth rank to No 2.

The stalled TPP puts China in the free-trade pole position and opens opportunities for writing new rules for international trade.

Earlier, speaking at the APEC CEO Summit in Lima, Peru, President Xi Jinping called on countries to speed up the negotiation of the Regional Comprehensive Economic Partnership (RCEP) as the basis for building the broader Free Trade Area of the Asia-Pacific (FTAAP) to pave the way for a more inclusive global economy.

RCEP excludes the US but includes 10 Asean countries plus Australia, China, India, Japan, New Zealand and South Korea; it covers 32 per cent of world GDP and 30 per cent of world trade.

FTAAP includes the US and China and 19 other world economies; it covers 55 per cent of world GDP and 44 per cent of world trade.

How will all this affect Hong Kong?

We enjoy a strategic geographical advantage, a well-developed infrastructure and a superb international communication network. Plus we play an important role as entrepot for trade between the Chinese mainland and the world. In 2015 Hong Kong was the world's eighth-largest trading economy in goods and the seventh-largest exporter and importer.

Due to our close trade links with the mainland, any mainland trade growth or decline would inevitably affect Hong Kong. For example, in 2015 we were the second-largest trading partner of the mainland (after the US), with a trade value accounting for 8.7 per cent of its total trade; also we were the mainland's second-largest export market, taking up 14.6 per cent or US$331.6 billion (S$478.5 billion) of its total exports.

In the same year, the value of goods re-exported through Hong Kong from and to the mainland was US$410.3 billion, comprising 89.4 per cent of our total re-export trade value.

Such a strong mainland-Hong Kong trade relationship would ensure that if the mainland could benefit from the demise of TPP, such benefits would also accrue to Hong Kong.

The US-based Peterson Institute for International Economics estimates that TPP would increase trade activity between its member countries, while China's annual export loss would be about US$100 billion.

But this gloomy scenario presumably will no longer happen.

The likelihood is that if TPP fails and RCEP comes into effect, China would benefit by US$88 billion, according to the US-China Economic and Security Review Commission's latest annual report, and Hong Kong would benefit accordingly.

So, can Hong Kong afford to stay complacent?

The answer is: "No."

We know that while the US economic loss presents opportunities for China as a whole, Hong Kong must also beware the economic difficulties that may result from a more protectionist environment.

Therefore, the Hong Kong Special Administrative Region (SAR) should ride the post-TPP tide and aggressively expand its bilateral and multilateral trade agreements.

First, Hong Kong must complete its negotiations with the Asean countries for a free-trade agreement.

Asean is economically the fastest growing group globally, and is our fourth-largest export market and second-largest trading partner.

The Hong Kong-Asean Free Trade Agreement, coupled with the mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA), would provide a solid platform to facilitate trade and investment among Hong Kong and Asean countries and enhance our role as a regional trading hub.

This would also facilitate Hong Kong's partnering with Asean countries and companies participating in the Belt and Road (B&R) Initiative which encompasses about 60 countries and covers 40 per cent of world GDP and over 60 per cent of world population.

Hong Kong's next major task is to work closely with the Beijing-led Asian Infrastructure Investment Bank (AIIB), a financial vehicle closely connected with the B&R Initiative.

After the AIIB was established at the end of 2015, 57 countries had signed its inter-governmental agreements.

As China's first multilateral financial institution, AIIB will provide new opportunities for countries both inside and outside Asia.

James Woolsey, a Trump senior adviser on national security, defence and intelligence, has said that the Obama administration's opposition to AIIB is a "strategic error".

He hoped Trump would be more enthusiastic about China's B&R Initiative. Perhaps we can hope that when Trump takes office in January 2017, there may be a US policy change favouring more US-China cooperation.

The author is an independent scholar and freelance writer. She is also the founder and president of the China-US Friendship Exchange Inc.

Trade finance remains poor relation of populist state industry hand-outs

As the 1980s dawned the Silicon Valley of the South Seas was the Hutt Valley. Apple’s Steve Wozniak cruised the valley in awe of the digital presentation skills of the state television operation based on the Avalon studios. The state’s own physics and engineering laboratory was at work on advanced integrated circuitry and superconducting.

A privately held company variously known as Systems and Programmes Ltd, SPL, and Progeni had designed a desk top product that had taken interactive screen graphics further than any other developer had taken the science up to this time.

More significantly still, the company had a branded product ready to sell. Better still, it had a customer ready and waiting, wanting to buy the new product range aimed which was aimed at the education sector.

At this time China had not yet become the market star it was to become several decades later.

China was then a nightmare for anyone exporting anything other than raw commodities. The problem was in getting paid – a problem that continues now still throughout Asia.

The deal was an early forerunner of what became an established yet still unspoken and thus unrecognised problem

Samples and drawings are required (and copied). Everything was, and still is, forthcoming but payment.

This was before the era in which China transitioned to a virtual free market economy.

The specific selling proposition underpinning the Lower Hutt desk tops was the graphical user interface and thus their application in practical teaching.

A Chinese mining company said it wanted thousands of the machines in order to instruct employees in safe mining practices. The photograph of the Poly desk top computer, as it was known, shows its custom moulded rugged sealed casing. (Photograph courtesy Retrowe Museum.)

The demand was now identified. But in the classic tradition of such deals in the region then as now, the method of payment remained floating in the air.

Banks at all stages within China and outside it were involved in order to devise a scheme of credit finance.

More samples were sent to China.

At this time New Zealand’s rigorous import licensing/quota restrictions were still in force.

Steel, the logical counter trade commodity in the deal was out of the question because of the need to protect New Zealand Steel.

At this time the Chinese had not yet developed their consumer range products such as whiteware to the stage of being considered as barter trade products.

SO the deal languished. Until that is someone thought of bicycles. New Zealand didn’t make them. The kit assemblies of the Raleighs and Rudges of the era was confined to the back rooms of the retail bike shops.

SO there was no concerted vested-interest lobby against bicycles becoming the counter trade counterweight to the sending to China of the desk top computers.

A test shipment of bicycles duly arrived in Lower Hutt. And failed to sell.

The early enthusiasm for bicycling had waned, and was not to reappear until much, much later when it again became viewed as a fashionable, rather than an eccentric, pastime.

The episode which amounts to one of lost opportunity, remains of value now because it points up the lack of export trade finance capability in New Zealand, a nation which no longer even has its own merchant bank, or one to rank with the international version.

The conditions of the era described here exist substantially to this day. The existing banking structure is attuned to restricting risk to the taking of real estate collateral.

The official trade promotion and development departmental apparatus refuses to acknowledge even the chronic problem now of receiving payment for manufactured or processed goods sent to Asia.

It has a see-no-evil stance on things like Asian buyer fees for tender and tender deposits along with endless and unacknowledged copying problem.

A favoured official dead-end referral is to the development banks such as the Asian Development Bank.

New Zealand has never really been on the must-help list of these banks, in spite of a generalised reluctance to admit it.

|  From the MSCNewsWire reporters' desk  |  Wednesday 14 December 2016  |

Dumping products should not be allowed in the New Zealand market, says ManufacturingNZ.

Dumping is selling products in an export market at a lower cost than they are sold in their home marketParliament's commerce select committee has been considering a Trade Bill* that would allow dumping to occur in New Zealand as long as a 'public interest' test was followed.

The select committee has now reached deadlock on the issue, and is not able to provide a recommendation to Parliament on whether the Bill should proceed.ManufacturingNZ Executive Director Catherine Beard says the Bill should not proceed.

"This Bill came about because there was seen to be a need to reduce the cost of construction materials for the Christchurch rebuild.

"After the Christchurch earthquakes, the Government suspended penalties, for three years, against Thailand, Malaysia and China for dumping construction products. Now the three-year period is coming to an end, a decision has to be made on what to do about dumping in the future.

"The Bill would allow dumping if a 'public interest' test was applied.

"But manufacturers consider the proposed test would be subjective and unworkable and would make New Zealand-made products vulnerable to unfair predatory pricing by international competitors.

"Anti-dumping rules are important for New Zealand – we depend significantly on international trade, and we follow World Trade Organisation rules in all countries we export to. If we were to dump product in any of our overseas markets we would expect to have anti-dumping penalties imposed.

"New Zealand manufacturers therefore urge lawmakers not to facilitate dumping in New Zealand," Catherine Beard said.

*Trade (Anti-dumping and Countervailing Duties) Amendment Bill

|  A BusinessNZ release  |  Dec 13, 2016  |

The growing economic, cultural, diplomatic, sporting, and tourism links between India and New Zealand were the highlight of the end-of-year celebration between the two countries organized by India Trade Alliance in Auckland on Monday.

The keynote address was delivered by the New Zealand High Commissioner designate to India, Joanna Kempkers. Speaking at her first public event to delighted ITA members, Ms. Kempkers said, The High Commissioner designate, using the analogy of an Acorn, told the audience that ‘Just like an acorn being the symbol of NZ India relationship, I would like to nurture it, feed it and see it grow like an oak tree during my tenure in Delhi’.

Earlier welcoming over 100 ITA members and stakeholders, ITA General Secretary said, “It is time for New Zealand businesses to take the Indian market seriously. While our common connections of Commonwealth, food, film and cricket are good connectors, we need to put more emphasis on the people to people connections and the doors they can open.”

New Zealand First Member of Parliament Mahesh Bindra also congratulated ITA on a very successful year and encouraged the members to stay focused and think of India as a long-term partner where results will come to those who are tenacious.

Thanking the attendees, the Co-Deputy Chairman of ITA, Dr Don Brash, said that ITA was particularly pleased that Ms Kempkers had made a gathering of ITA members and supporters her first official engagement since her appointment.

The event was hosted by PwC and attendees included the CEO of EMA and industry partner of ITA Kim Campbell, senior representatives from ANZ, BNZ, ASB, Westpac banks, government agencies including NZTE and MFAT, education institutions, arts and culture sector, exporters and importers.

Earlier in November, ITA members conveyed their confidence in the board by electing the existing board with the addition of Chandan Ohri, Managing Partner – IBM Global Business Services for New Zealand, as the Treasurer.

|  A India Trade alliance rrelease  |  Dec 13, 2016  |