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Beware FTA, says Kiwi in China

Dominion Post, Wellington

Beware FTA, says Kiwi in China

1 April 2008

Shifting production of her brand to China has put more money in Cushla Reed’s pocket, allowed her to make lifestyle choices such as having a baby, and given her business a future.

But the Minx shoe founder, who shifted production overseas, first to Fiji in 2005, then to China, does not support the free trade deal which will be signed with China in Beijing next week.

"The people left surviving in this competitive market ... need a bit of help."

Ms Reed also adds a word of caution to those expecting to make quick money out of China.

She says production costs are rising fast as trade unions wield increasing influence and workers expect better wages and conditions in an increasingly consumer-driven society.

She estimates rising wages and fuel costs have added 15 per cent to the cost of production since last season.

But she acknowledges that shifting production to China was a life-changing decision for her - even if she disagrees with the free trade agreement on principle.

"There is no way in this world that I would have ever been able to afford the privilege of having a child if I was still trying to make shoes in New Zealand, because it was such an intensive job.

"Now I’ve got really good shoe factories that are producing great products for me and without the headaches of employing staff in New Zealand, and all the red tape ... that was just crippling me."

The free trade deal is expected to phase out the remaining tariffs on clothing, footwear and carpets protecting New Zealand manufacturers against cheap Chinese imports, while China is expected gradually to phase out its far more punitive tariffs on New Zealand’s agricultural exports.

But the Government is refusing to release details till the deal is signed on Monday after Prime Minister Helen Clark arrives in Beijing.

It has also been forced to defend the timing of the deal, which occurs against a backdrop of bloodshed in Tibet.

Miss Clark gave an assurance yesterday the free trade deal would not stop her raising concerns about Tibet and human rights abuses.

"I fully appreciate and share the concerns people have around human rights in China. I’ve expressed those concerns myself for many years."

There was further controversy yesterday, when Miss Clark refused to step in after the Chinese Government denied a visa to Wellington-based Chinese news journalist Nick Wang so he could accompany the official party to Beijing for the signing.

Mr Wang was removed from a Beehive press conference last year at the request of Chinese officials.

Miss Clark said Mr Wang’s name had been forwarded with other journalists’ by the Foreign Affairs and Trade Ministry.

"We live in a country where we are very open to media. China isn’t such a country."