Despite potential global tariff impositions by U.S. President Donald Trump, New Zealand is confident in its trade relations with the United States.
New Zealand’s Finance Minister Nicola Willis, in an interview with CNBC, stated that “New Zealand is distinguished in that we have a very balanced and complementary trade relationship with the United States,” and expressed hopes to continue fostering positive trade relationships.
Willis mentioned that the U.S. imports New Zealand meat and wine, while New Zealand imports significant goods and services from the United States.
President Trump announced plans to impose a 25% global tariff on steel and aluminum imports to the U.S., which is in addition to previous tariff threats involving Canada and Mexico.
According to New Zealand’s Ministry of Foreign Affairs and Trade, New Zealand’s exports to the U.S. totalled 14.6 billion New Zealand dollars (approximately $8.26 billion), surpassing Australia as New Zealand’s second-largest export market. Imports amounted to NZ$11.4 billion for the year ending March 2024. This resulted in a trade balance of NZ$3.5 billion and a total trade value of NZ$25.8 billion, without adjusting for inflation.
Willis described the bilateral relationship as “one that works for both parties,” emphasising New Zealand’s membership in the “Five Eyes” intelligence alliance, which she regards as “a foundation of a very strong strategic relationship.” The “Five Eyes” alliance includes Canada, the United States, the U.K., Australia, and New Zealand.
When questioned about the possibility of New Zealand avoiding tariffs from Trump, Willis responded that decisions on tariffs are matters for the U.S. administration, and that New Zealand would deal with any resulting situation.
Willis believes that the New Zealand dollar could provide some buffers if tariffs are implemented, noting that a lower New Zealand dollar would aid the country’s exporters by enhancing the competitiveness of exports.
The New Zealand dollar recently weakened to its lowest point in over two years against the U.S. dollar, trading at 0.5515 to the greenback on Feb. 3.
Willis also acknowledged the country’s significant current account deficit, but added that the flexibility of the exchange rate will allow balancing to occur.