Various sectors of the economy has met New Zealand’s announcement of a Free Trade Agreement (FTA) with the United Kingdom with enthusiasm and anticipation. Economic ties are expected to be deepened and new avenues for trade to be opened between the two nations by the agreement that is set to take effect on May 31.
The NZ-UK FTA has been hailed by Export New Zealand, an organization representing exporters, as comprehensive and modern, with confidence in the strengthened economic relationship it will foster. The exceptional market access package achieved through the negotiations was highlighted by Josh Tan, Senior Policy Advisor at Export NZ.
According to him, 99.5 percent of current exports will enter the UK tariff-free, and the path will be cleared for 100 percent tariff elimination for NZ exporters by this agreement. He sees this development as a boon for British consumers who enjoy New Zealand products like sauvignon blanc and spring lamb. It will simultaneously benefit Kiwi exporters.
The positive impact of the FTA on bilateral trade was emphasized by Business NZ Chief Executive Kirk Hope. The amount of around six billion dollars annually was achieved by the two-way trade between New Zealand and the UK prior to the COVID-19 pandemic, and experts expect the figure to rise with the implementation of the FTA.
A strong signal is sent to British investors by the agreement, affirming that New Zealand’s stability and transparency make it an attractive investment destination.
According to Canterbury Employers’ Chamber of Commerce, better access for Canterbury exporters to the UK market will be provided by the agreement. The benefits for primary sector and manufacturing businesses in the Canterbury region were also emphasized by Leeann Watson, CEO of the Chamber.
The reduction of export costs and levelling of the playing field, enhancing the competitiveness of New Zealand products in the UK market, are expected by FTA. A chapter in the agreement is dedicated to maximizing opportunities for small and medium-sized businesses, which are regarded as engines of growth in the local economy.
The early implementation of the FTA with the UK was welcomed by the horticulture industry, which has faced numerous challenges during the COVID-19 pandemic. Gratitude to government officials for expediting the agreement, citing its potential to provide hope for the future and support industry growth, was expressed by Nadine Tunley, Chief Executive of Horticulture New Zealand.
The aim of increasing the industry’s value to $12 billion by 2035 unites the FTA and the Aotearoa Horticulture Action Plan. The elimination of tariffs and non-tariff barriers, making the FTA’s early adoption a significant step toward achieving these goals are included in the plan.
The FTA was celebrated by the Dairy Companies Association of New Zealand (DCANZ) due to its positive impact on the dairy sector. According to Kimberly Crewther, Executive Director of DCANZ, complete duty-free entry into the UK market by 2028 will be achieved due to the agreement, and New Zealand exporters will be able to compete with their European counterparts on an equal footing.
Substantial potential for New Zealand dairy products is held by the UK, the world’s second-largest dairy import market. Opportunities for increased trade and market share will be created by the elimination of tariffs on various dairy products, including liquid milk, yogurt, and infant formula.
Market dynamics and commercial demand will regulate the actual level of trade, while the FTA’s entry into force marks a significant milestone for New Zealand’s trade with the UK. Nonetheless, a valuable platform for building stronger relationships with UK dairy customers and expanding export options for New Zealand’s dairy industry is provided by the agreement.
As this new chapter of free trade cooperation is embarked on by New Zealand and the United Kingdom, the mutual benefits and strengthened economic ties that lie ahead are anticipated both countries.