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UK and New Zealand seal free trade agreement; next step Trans-Pacific Partnership (CPTPP)

Thursday, October 21st 2021 - 08:55 UTC
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Video conference between NZ PM Jacinta Ardern and UK's Boris Johnson Video conference between NZ PM Jacinta Ardern and UK's Boris Johnson

A comprehensive trade agreement with New Zealand will cut red tape for businesses, end tariffs on UK exports and create new opportunities for tech and services companies while making it easier for UK professionals to live and work in New Zealand.

The ground-breaking deal was agreed in a video call Wednesday, 20th October, between Prime Minister Boris Johnson and New Zealand Prime Minister Jacinda Ardern after 16 months of talks by Department for International Trade negotiators.

UK-New Zealand trade was worth £2.3 billion last year and is set to grow under the deal. The deal will remove barriers to trade and deepen access for UK advanced tech and services companies, while making it easier for smaller businesses to break into the New Zealand market.

Tariffs as high as 10% will be removed on a huge range of UK goods, from clothing and footwear to buses, ships, bulldozers and excavators, giving British exporters an advantage over international rivals in the New Zealand import market - a market which is expected to grow by around 30% by 2030. High-quality New Zealand products loved by British consumers, from Sauvignon Blanc wine to Manuka honey and kiwi fruits, could be cheaper to buy. 

UK workers will benefit from improved business travel rrangements and professionals such as lawyers and architects will be able to work in New Zealand more easily, allowing UK companies to set up shop and bring the best British talent with them. Both sides have also committed to a mobility dialogue outside the trade agreement that will consider how people-to-people links can be deepened further.

The New Zealand trade deal follows advanced free trade agreements already struck with Australia and Japan and helps pave the way for UK to join Trans-Pacific Partnership (CPTPP), a free trade area of 11 Pacific nations with a GDP of £8.4 trillion in 2020.

Prime Minister Boris Johnson said it was a great trade deal for the United Kingdom, cementing our long friendship with New Zealand and furthering tees with the Indo-Pacific.

“It will benefit businesses and consumers across the country, cutting costs for exporters and opening up access for our workers. This is a fantastic week for Global Britain. On Tuesday we raised almost £10bn in investment for the industries of the future, and this new deal will help drive green growth here and on the other side of the world in New Zealand.” 

New Zealand Prime Minister Jacinda Ardern said that UK and NZ are great friends and close partners. The historical connections that bind us run deep. “This world-leading free trade agreement lays the foundations for even stronger connections as both countries embark on a new phase in our relationship. It is good for our economies, our businesses and our people”.

British International Trade Secretary Anne-Marie Trevelyan described the deal as a win-win for two like-minded democracies who believe in free and fair trade. It delivers for families, workers and businesses across Britain, and sets the stage for greater cooperation between our two nations on global challenges like digital trade and climate change.

“It is a vital part of our plan to level up the country: slashing costs and red tape for exporters, building new trade routes for our services companies and refocusing Britain on the dynamic economies of the Asia-Pacific”.

CBI president Lord Karan Bilimoria, said this agreement in principle, is a big step forward and will be welcomed by businesses. “ New Zealand and the UK are at the fore of the green trade revolution and this deal has the potential to showcase to the world that trade and tackling climate change can go hand-in-hand. This is not just about goods but also enabling fluid services trade - digital policies that underpin all industries and innovation” .

Categories: Economy, Politics, International.

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