A landmark 11-country trade deal, a revamped version of the Trans-Pacific Partnership (TPP), came into force on Sunday with New Zealand's trade minister hailing the opportunities it presented for exporters.
The deal, which will slash tariffs across much of the Asia-Pacific region, does not include the United States after Washington pulled out of the TPP negotiations in 2017.
"The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) provides New Zealand with trade agreements for the first time with three significant economie Japan, Canada and Mexico," Trade Minister David Parker said in a statement.
"The CPTPP has the potential to deliver an estimated NZ$222 million ($149.01 million) of tariff savings to New Zealand exporters annually once it is fully in force."
The pact came into effect on Sunday for Australia, New Zealand, Canada, Japan, Mexico and Singapore, with Vietnam to follow on 14 January, Australia's Department of Foreign Affairs and Trade said on its website.
Brunei, Chile, Malaysia and Peru will begin 60 days after they complete their ratification process.
Investment bank HSBC said in a press release that 90 percent of tariffs on goods in the first six countries were removed on Sunday in the first round of cuts.
Australia is looking forward to favourable conditions for its agricultural exports including wheat, prompting U.S. competitors to warn they will need help to compete.
"Japan is generally a market where we seek to maintain our strong 53 percent market share, but today we face an imminent collapse," U.S. Wheat Associates President Vince Peterson told a public hearing in Washington on Dec. 10.
"In very real terms, as of April 1, 2019, U.S. wheat will face a 40 cent per bushel, or $14 per metric ton, resale price disadvantage to Australia and Canada," Peterson said, according to a transcript on the U.S. Wheat Associates website.
The deal will reduce tariffs in economies that together amount to more than 13 percent of global gross domestic product (GDP) - a total of $10 trillion. If the United States were included, it would have represented 40 percent.
U.S. President Donald Trump said in April that he would consider rejoining the trade agreement if the terms were more favourable to the United States. ($1 = 1.4899 New Zealand dollars)
