NZ Trade Policy Under Pressure as Free-Trade Agreements Fail to Deliver
New Zealand's trade policy is being tested by the changing global landscape, where free-trade agreements are no longer enough to guarantee market access.
The country's terms of trade fell 9% in June, as export prices rose 3.5% while import prices jumped 14%, driven by rising fuel and input costs that exporters cannot control.
Economists argue that the old playbook of signing more free-trade agreements is no longer effective, as tariffs are no longer the main barrier to trade. Instead, regulation and standards behind the border have become the key friction points.
The Reserve Bank's data shows a choppiness in the terms of trade index, which swung from 1593 in December 2025 to 1561 in March 2026, before falling further in June. Net external liabilities remain high at 44.3% of GDP.