UK and New Zealand ink trade deal
London, Oct 21: Following 16 months of negotiations, the UK and New Zealand announced they signed a trade deal eliminating tariffs on a wide range of goods.
The deal was cemented over a Zoom call between British Prime Minister Boris Johnson and New Zealand Prime Minster Jacinda Ardern. While some of the details are yet to be finalized, the deal is expected to come into effect next year.
Ardern said the deal was one of the best New Zealand had ever signed. In the UK, ministers eager for low tariff trade following the country's exit from the common market of the 27-nation EU bloc, hope the trade deal with New Zealand can facilitate the country's entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
The CPTPP consists of a 11-country bloc including Japan, Australia, Singapore and Mexico, among others.
What is in the UK-New Zealand trade deal?
While trade with New Zealand accounts for a mere 0.2% of UK trade, New Zealand has said the deal would boost the country's economy by one billion NZ dollars ($720 million, €618 million). The deal follows a similar deal between the UK and Australia.
New Zealand expects to sell more wine, butter, cheese, beef and lamb to the UK. After 15 years, all tariffs will be dropped.
British farmers, however, remain uneasy about the consequences given shortages and labor supply pressures.
Minette Batters of the UK's National Farmers' Union President said, "The government is now asking British farmers to go toe-to-toe with some of the most export-orientated farmers in the world, without the serious, long-term and properly funded investment in UK agriculture that can enable us to do so."
Political leaders upsell the benefits
Johnson was keen to sell the deal as "a great trade deal for the United Kingdom, cementing our long friendship with New Zealand and furthering our ties with the Indo-Pacific."
He said, "It will benefit businesses and consumers across the country, cutting costs for exporters and opening up access for our workers."
Ardern though had much more to celebrate, telling a news conference in Wellington, "This deal serves New Zealand's economy and exporters well as we reconnect, rebuild and recover from COVID-19, and look forward into the future."
Tariffs on 97% of all goods will be abolshed for both countries the day the deal comes into effect.