An Empirical Examination of Trade Relations between New Zealand and China in the Context of a Free Trade Agreement

This study examines the bilateral trade relations between New Zealand and China between 1980 and 2012. Specifically, it examines, first, the strength of the trade relationship using export and import intensity indices. Secondly, it identifies the degree of trade reciprocity using a 'trade reciprocity index'. Thirdly, it estimates the magnitude of intra-industry trade using the Grubel-Lloyd and Aquino indices. Fourthly, it analyses the results from these indices to consider how trade patterns, directions and trade relations have changed between 1980 and 2012. Finally, it assesses the future prospects of trade and economic cooperation between New Zealand and China in the context of the their 2008 free trade agreement. This is the first - and possibly the only study of its kind - since the signing of the trade agreement.