Wellington, Nov. 12 - The leaders of New Zealand and Uruguay agreed Monday to hold annual bilateral foreign policy talks, and announced plans for a deal to eliminate double taxation and encourage investment in each other's economies.
An expansion in investment was expected to particularly focus on dairy products - a key foreign currency earner for New Zealand, worth about NZ$8 billion (US$6 billion) for the economy per year and second only to tourism.
"Expanded ties can be a win-win for both of us," Prime Minister Helen Clark told reporters after meeting with Uruguayan President Tabare Vazquez in the capital, Wellington, noting "a very significant recent increase in New Zealand business interest in Uruguay."
New Zealand Farming Systems Uruguay, which already owns 31,000 hectares of farmland in Uruguay, announced Monday it was raising NZ$50 million to expand its intensive dairy farming operations there.
Clark said matching New Zealand investment and dairy technology with Uruguayan resources "could result in a 10% increase in total Uruguayan dairy production in five years time."
Vazquez and his delegation of business leaders, Cabinet ministers and other officials, were expected to visit a farm on South Island on Tuesday to view high-production, sustainable dairy farming.
Clark and Vazquez also agreed to begin regular high-level talks, and they were considering how to promote more bilateral investment, including a double taxation agreement to reduce overseas investment taxes. They agreed to double to 200 the number of young people who can work in the other's country every year on working vacation visas.
"I am very encouraged by the speed of growth and I'm sure we can do more ... together," Clark said.
Vazquez, who arrived in New Zealand late Sunday, was scheduled to fly to Malaysia on Wednesday.