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NZ-EU Free Trade Agreement to come into force in May

March 23, 2024
in Business
NZ-EU Free Trade Agreement to come into force in May
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Flags in front of the EU Commission building in Brussels.

MPs have voted for a Free Trade Agreement with the European Union to come into force.
Photo: 123RF

New Zealand’s Free Trade Agreement with the European Union will come into force on 1 May.

MPs voted overwhelming in favour of legislation in Parliament on Thursday afternoon, with only Te Pāti Māori opposed, allowing the deal to take effect in just over a month’s time.

The EU has already completed its ratification processes and the agreement has been signed off by the European Parliament and Council.

From 1 May, 91 percent of tariffs on New Zealand goods into the European Union will be removed. That will eventually rise to 97 percent.

There will be immediate tariff eliminations for all kiwifruit, wine, onions, apples, mānuka honey and manufactured goods, as well as for almost all fish and seafood and other horticultural products.

Once fully in place, the agreement will deliver new quota opportunities worth more than $600 million in annual export earnings, with an eight-fold increase to the amount of beef able to be sold into Europe.

Duty free access for sheep meat has been expanded by 38,000 tonnes each year.

Red meat and dairy will get up to $120m worth of new annual export revenue on day one of the deal, with estimates of more than $600m within seven years. Quotas have been established for butter, cheese, milk powders and protein whey.

Trade Minister Todd McClay told the House the final reading of the legislation was an important moment.

“The free trade agreement will open up significant new opportunities for New Zealand businesses already trading in Europe by levelling the playing field with their competitors.”

Currently, New Zealand kiwifruit exporters paid a tariff of 8.8 percent on their exports to the EU, while their competitors in Chile paid nothing, he said.

“From 1 May those tariffs will be lifted, saving our kiwifruit industry $47m per annum, and making them more competitive in the EU market. From 1 May, 99.5 percent of our fish and seafood exports to the EU, including hoki, mussels, and squid, will enter duty free, saving the industry $20m in tariffs each year.”

It was not just existing exporters who would benefit, he said – when the agreement came into force, the proportion of New Zealand exporters covered by free trade agreements would exceed 70 percent for the first time.

“This gives our exporters greater choice about where they do business and opens up new opportunities for these businesses that might be interested in expanding into the European market,” McClay said.

“We’ll also be lifting our remaining tariffs on European goods coming into New Zealand, which is great news for consumers and retailers who will have access to quality European product at a more competitive price.”

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Copyright for syndicated content belongs to the linked Source : RNZ – https://www.rnz.co.nz/news/business/512344/nz-eu-free-trade-agreement-to-come-into-force-in-may

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