Changes need to be made to the multilateral trading system, says commercial law firm Chapman Tripp.
The announcement followed a positive bilateral meeting between Trade Minister Todd McClay and Chinese Commerce Minister Gao Hucheng.
Fonterra chairman John Wilson said, "The upgrade of the FTA provides an opportunity to strengthen the already strong dairy relationship between New Zealand and China. I am pleased that the leadership of both countries recognise the value of continuing to improve the FTA. We are committed to continuing to build our business in China and the FTA will remain the key platform for that growth."
Fonterra has operated in China for more than 40 years, and has developed an integrated business strategy encompassing farms, ingredient products, foodservices and consumer brands including Anchor, Anlene and Anmum.
China is New Zealand's largest dairy export market with NZD $2.7 billion worth of trade in 2015. Fonterra has substantial investments on the ground in China, including a strategic partnership with Beingmate, a leading Chinese infant and child food manufacturer. It has completed two farming hubs and is working on a third in partnership with Abbott. Fonterra employs more than 1,500 people in China. Fonterra is also the leading premium imported dairy provider in the foodservices sector in China.