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Middle East trade agreement opens opportunity for dairy
The Free Trade Agreement negotiated with the Gulf Co-operation Council (GCC) is good news for Fonterra, New Zealand dairy farming and the economy, according to Fonterra chairman, Sir Henry van der Heyden.
Fonterra exported NZ$686m of dairy product to these countries in the year to last May. That was up from $498m in the 2006/07 year.
Sir Henry said there were exciting opportunities in the region, which has a large population of younger people. In Saudi Arabia, for example, 41% of the population is aged 15 years or younger, so dairy products were very important in delivering protein and calcium.
The conclusion of the negotiations represented a significant opportunity for Fonterra in a high-demand region, Sir Henry said. “While the details have yet to be released, dairy trade currently faces tariffs of 5%, and we believe the agreement will allow us to become more competitive and to lift sales further.”
The agreement builds on the gains from FTAs with ASEAN, China and most recently Malaysia. Some 40% of Fonterra’s exports now go to countries with which New Zealand has established FTAs.
Source: Fonterra
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