New Zealand businesses will get better access to an estimated US$1.6 trillion worth of overseas government contracts, or 2.64 percent of the world’s GDP, by joining the World Trade Organisation’s Government Procurement Agreement (GPA).
Under the agreement member countries are not allowed to discriminate against businesses from another country in their government procurement processes and must follow rules relating to competition and openness.
Economic development ministry Steven Joyce said joining the GPA created some new opportunities for New Zealand businesses to export more products and services to more destinations.
“Joining will not have a big impact on New Zealand government agencies because they already conduct their procurement in line with the agreement’s fundamental principles,” he said.
“We already follow the rules, but just don’t get the benefit for our New Zealand exporters. Joining up to the GPA will improve all access and reduce costs for exporters.”
It will take about two years for New Zealand to be fully accepted.
Forty-two countries, including the US, Canada, Korea, Japan and the 27 countries of the European Union, currently belong to the agreement. It covers the purchase of a broad range of goods and services that government agencies buy from the private sector, including construction.
The government has also released its Building Export Markets progress report confirming its goal to increase the contribution of exports to the economy from 30 percent to 40 percent of GDP by 2025
It's the first of six reports on the government’s Business Growth Agenda. Others will address innovation, skills, capital markets, infrastructure and resources.
New projects mooted in the progress report include exploring changes to the Large Budget Screen Production Grant that would enable more New Zealand firms to win international business and a 'clearinghouse' to coordinate government efforts to address onshore regulatory barriers to exports.
The government is currently working on developing country and regional strategies for Australia, the US, ASEAN, the Gulf Cooperation Council, and Europe, as well as exploring new regimes to promote new export areas such as food or education.