Now is New Zealand's time in Southeast Asia

Forecasts from the Economist Intelligence Unit (EIU) are for positive GDP growth in the region, with countries like India and Indonesia eyeing rates of 6.3 and 4.4 per cent respectively.

Singapore’s open economy means it is usually first in and out of a global recession.

Having sizeable domestic markets has helped countries like India and Indonesia sail through relatively unscathed while in other places stimulus packages have had an impact.

Companies are restocking and are prepared to increase production. There is keen interest in New Zealand pine, for example, after a quiet period last year.

But while opportunities abound, things are not exactly as they were before the economic downturn. A phrase doing the rounds here is ‘the new normal’.

There is less waste and overt excess. Frugality and sustainability are the post recession principles.

New Zealand will have a clear edge in the region in 2010, with two Free Trade Agreements (FTAs) taking effect. 

First up is the ASEAN – Australia – New Zealand FTA (AANZFTA), which went live on 1 January. New Zealand’s FTA with Malaysia follows four months later.

Over the next 12 years, AANZFTA will eliminate 99 percent of tariffs affecting our trade with 10 ASEAN countries, which includes some of the fastest growing economies in the world.

The Malaysia FTA is the icing on the cake. It’s not just that tariffs will virtually disappear within seven years, there’s also encouragement for New Zealand companies to invest in Malaysia and use it as a springboard for expansion into other parts of the region.

Early beneficiaries of that may well be education consultancy businesses and those with green technologies. Incentives include treating New Zealand firms that take a majority shareholding in a Malaysian company, or set up a joint venture, exactly the same as homegrown Malaysian companies.

New Zealand exporters are also guaranteed customs clearance of goods within 48 hours and will be able to self declare the origin of the goods. Bonuses like that will make it much easier to do business in Malaysia particularly while we have competitive advantage.

Australia is yet to conclude its FTA negotiations with Malaysia and even when it does, ‘favoured nation’ clauses mean benefits secured by others will have to be passed on to New Zealand.

The FTAs have raised New Zealand’s profile in the region and now’s the time to build on that. Relationships are key so visit if you can - but also put some time into understanding what the new trading relationships mean at a company level.

It takes a bit of work but if you are sourcing raw materials or components from Asia, there are real gains to be had out of our preferential status with Malaysia and ASEAN countries.

Keep an eye on www.nzte.govt.nz for details of an event we’ll be holding in New Zealand early this year, to promote both FTAs and the benefits they offer.

Alan Koziarski is, Regional Director, South and Southeast Asia, New Zealand Trade and Enterprise and is based in Singapore.

This article was first published in The Independent on 21 January 2010.