Trade and Gender Review of New Zealand

Executive Summary

The OECD Trade and Gender Framework of Analysis establishes an approach to understanding the impact of international trade and trade policies on women in three key economic roles: as workers, as consumers and as business owners and leaders. This Trade and Gender Review of New Zealand, undertaken jointly by the OECD and the New Zealand Ministry of Foreign Affairs and Trade (MFAT), employs quantitative and qualitative analysis to identify policy steps towards ensuring that that open markets and a rules-based international trading system in good working order contribute to women’s economic empowerment.

Women as workers: From the perspective of women as workers, the Review demonstrates that, although women’s participation in trade-related jobs has grown, and grown faster than that of their male counterparts, women remain underrepresented in trade-related jobs. Today, women comprise about 40% of New Zealand’s export-related employment. While women are more engaged in exporting than ever before, they remain underrepresented in export employment compared to their share of the total workforce, where they make up 47% of persons employed, and the working age population, of which they comprise 51%. Moreover, women’s participation in export sectors, although having grown significantly, has grown less than their participation in non-export sectors.

Women as entrepreneurs and business leaders: Similar to women workers, women entrepreneurs and business leaders are less engaged in trade than their male counterparts. This is in part due to the smaller size of their businesses; small firms tend to be less engaged in trade than larger firms. That said, women-led firms have a marginally higher export propensity than men-owned firms of similar size. So while women appear to be significantly less likely to lead a firm (including an export firm) and their firms are generally smaller, those firms that they do lead are marginally more willing to sell overseas compared to similar sized firms led by their male counterparts.

Women as consumers: One of the main gains from trade is to lower prices and increase the purchasing power of women consumers. Since lower-income households tend to spend a larger share of their income, rather than saving or investing, their purchasing power rises more when trade barriers are reduced and consumer prices fall. A stylized scenario of an increase in New Zealand tariff rates on imported goods from all countries except Australia to 25% estimated a drop in purchasing power parity of 9% in more vulnerable household types, such as single-parent households with dependent children. Women lead the vast majority of these households. These findings indicate that more vulnerable household types tend to benefit from lower consumer prices that are brought on by trade even more than less vulnerable household types, such as those with more than one adult.

Main findings

New Zealand is a small, open economy that ranks highly globally in terms of its trade policies, both in terms of it policies at the border and those that facilitate trade. New Zealand is ranked fourth globally out of 180 countries in terms of gender equality according to the World Economic Forum (2021[1]). Building on existing policies, the following trade and gender policy steps can help to ensure that open markets and a rules-based international trading system in good working order contribute to women’s economic empowerment.

• Making trade agreements more gender-sensitive: Ex ante impact assessments, the optimization of existing gender-related provisions, new or revised gender-responsive provisions, and strengthened monitoring and institutional support can make New Zealand’s trade agreements more gender-sensitive.

• Support for gender-sensitive policymaking in plurilateral contexts: New Zealand could support and promote gender-responsive policy initiatives such as the Global Trade and Gender Arrangement (GTAGA), application of the non-discrimination clause in the WTO Reference Paper on Services Domestic Regulation, ongoing work in APEC and elsewhere on gender-responsive standards, and the ongoing initiatives in WTO on trade and gender.

• Communication of the benefits of trade agreements: SMEs are less aware and less able to take advantage of the opportunities under trade agreements. Efforts to ensure that the benefits of trade deals are more widely understood, in particular by potential women exporters who may have more shallow networks, should be undertaken. Increasing public understanding of the benefits of trade and trade agreements more widely can also help to create constituencies that support open markets.

• Market access: New Zealand could prioritise market access reforms that would particularly benefit women. Although New Zealand is generally an open economy, there are areas, particularly in services, that could be considered for further market opening, including in relation to movement of people. Lower income consumers, where women are disproportionately found, spend more of their income and benefit more from the lower prices that result from trade.

• Aid for Trade: Outside New Zealand, gender gaps are generally greater and women often face substantial legal and administrative barriers to their participation in economic activity, in addition to strongly gendered cultural norms. Thus far, women’s economic empowerment has not been a stated objective in New Zealand’s Aid for Trade strategy. New Zealand could consider leveraging Aid for Trade to contribute to more gender equal outcomes by mainstreaming gender in its Aid for Trade strategy.

• Trade facilitation: Women-owned and women-led businesses in New Zealand, as in other OECD countries, tend to be smaller than those led by men. Administrative processes that are costly, time consuming, and non-transparent increase trade costs of small firms more than large ones that have more resources to better navigate challenging business environments. Facilitating trade through simpler processes and more transparent procedures will increase small businesses’ propensity to export, and decrease their trade costs. Although New Zealand ranks well among OECD countries in terms of facilitating trade, a more focused gender lens could be applied in order to ensure inclusivity in policy formulation and feedback from those impacted by facilitating measures.

• Representation of women: Ensuring that women are engaged in trade policymaking both as senior policy makers and as stakeholders will go a long way to ensuring trade policies work for women. A first step requires monitoring their involvement at all levels of policymaking.

• Trade promotion: Export promotion has been prioritised in New Zealand, both in terms of resources devoted to it, and the services the trade promotion authority, NZTE, provides. These programmes and services could be leveraged to ensure women entrepreneurs and exporters are fully supported in their export journeys.

• Professional and business networks: Women generally have shallower business networks (Korinek, Moïsé and Tange, 2021[2]) and seem to benefit less from traditional business networks (International Trade Centre, 2019[3]) than men. Although not strictly within the purview of government, some suggestions that aim to augment the usefulness of professional and business networks for women are included here.

• Address data gaps: This Review combines different data sources and extracts as much gender-differentiated information as possible from existing sources. Increasing collection of gender-differentiated data is one of the stated mandates both of the OECD 2021 Ministerial Council Statement1 and the Joint Ministerial Declaration on the Advancement of Gender Equality and Women’s Economic Empowerment within Trade2 and some additional suggestions for expanding or updating some major data sources are provided.

• Domestic policies: Although the focus of this Review’s policy recommendations is in the area of trade policy and its implementation, a certain number of domestic policy areas could be prioritised to ensure that women are in a position to take full advantage of the benefits of trade. These include, for example, policies that aim to close gender wage gaps, lowering the burden of unpaid work on women, ensuring representation of women in senior positions and ensuring women-led firms have equal access to government procurement contracts.

Notes

← 1.  “We call upon the OECD to model best practices in gender mainstreaming throughout its work, including through disaggregated data collection and analysis” (OECD 2021 Ministerial Council Statement, https://www.oecd.org/mcm/MCM-2021-Part-2-Final-Statement.EN.pdf, 5-6 October).

← 2.  The first of four objectives of the Joint Statement is to: “Continue to review, develop and improve national and/or regional collection of gender-disaggregated data that is comparable to the extent possible and analysis on trade and gender, to provide the basis for informed gender-responsive policies” (WTO/MIN(21)/4/Rev.1).