Tuesday, April 16, 2024

Anchors aweigh for new UK free trade agreement

The New Zealand UK Free Trade Agreement (UK FTA) comes into force today, with local businesses set to reap the rewards of the gold-standard trade deal.

The UK FTA is one of seven new or upgraded Free Trade Agreements negotiated by Labour to date, said Prime Minister, Chris Hipkins.

“The economy is through the worst, with inflation having peaked and returning to the target range next year, good growth, and more workers coming in to help with skill shortages,” the PM said.

“The benefits which begin flowing from the FTA today, provide a further big boost to our economy and will bring an up to $1 billion increase to our annual GDP.

“Our earlier than expected implementation means that from today New Zealand businesses will immediately save around $37 million dollars, with the instant elimination of tariffs and new duty-free quotas covering 99.5% of current exports.”

Trade Minister, Damien O’Connor said New Zealand’s wine industry – our biggest export to the UK – will see at least $25 million in tariffs disappear overnight. Honey producers will also no longer face a 16% duty and dairy and red meat sectors will transition to duty and quota free access for the first time in 50 years.

“This is a major delivery milestone and sits alongside the seven new or upgraded FTAs secured since 2017, which is helping to contribute to record earnings for our exporters,” said Mr O’Connor.

“The proportion of our export goods covered by an FTA have expanded from 52.5% to 73.5% since 2017 and shows the importance of these agreements to growing exports.

“We will continue to support New Zealand businesses by expanding into new markets and doing whatever we can to open doors and clear roadblocks making it difficult for exporters.”

In a cost of living crisis, the UK FTA cuts costs for exporters, boosts opportunities for small businesses, and will protect and create more jobs for New Zealanders, said Mr O’Connor.

“One in four jobs depend on trade – showing the importance of trade to our nation’s growing economy.”

“As the first FTA launched and concluded under New Zealand’s Trade for All agenda, this agreement sets high ambition commitments in inclusive and sustainable trade with outcomes on environment, gender, and a dedicated chapter on Māori Trade and Economic Cooperation,” he said.

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