Late push seals $1.8b trade agreement
PM says 11th hour EU free trade deal too good to leave — but not everyone is celebrating
After four years of often torturous negotiations, New Zealand and the European Union have agreed a free trade deal.
Prime Minister Jacinda Ardern, who helped conclude negotiations in Brussels, said it would help grow exports to the European Union by $1.8 billion a year by 2035.
Ardern had played down hopes of a deal, saying she was “very willing to come away from Europe without final conclusion” if it did not offer significant market access.
But, ultimately, final talks were concluded by New Zealand’s chief negotiator Vangelis Vitalis and Trade Minister Damien O’connor, just hours before Ardern was scheduled to leave Brussels for London.
“Despite many challenges, we got there, and today we deliver an agreement that represents improved trade opportunities for our exporters,” Ardern said, as she announced the deal with European Commission President Ursula von der Leyen.
A full 91 per cent of tariffs will be eliminated on the day the agreement comes into force, with 97 per cent eliminated by the seventh year.
O’connor was yesterday defending the agreement across media saying they did “very, very well” to secure the deal and that it opens up huge opportunities for exporters in New Zealand.
“This is the best opportunity we’ve had and the best deal we can get for a very long time. Of course we didn’t get everything that everybody wanted but that’s a trade deal,” he told AM yesterday.
“Obviously, we have heard some comments from a couple that are disappointed with the volumes but they get far better access than they’ve had and we can work on that,” he said.
He told Breakfast negotiations were long and right down to the wire.
“We made progress and $1.8 billion of value after year seven — that’s worth fighting for.”
Addressing the meat and dairy
"Of course we didn’t get everything that everybody wanted but that’s a trade deal." Trade Minister Damien O’connor
industry, O’connor said they got the best deal possible.
“We went literally to discussions five minutes before we were at the announcement on issues. We fought hard and negotiators did right up to the last minute.
“We extracted a bit more value even in the last half hour of the agreement for our side.
“But ultimately, this is a compromise. This is an agreement on trade and there are multiple interests in both sides of the agreement and we just have to reach a final conclusion.”
O’connor said it was ultimately better to have a free trade agreement with the European Nation than not to have one at all.
O’connor said it was only going to get harder to get to a deal with the EU due to the geopolitical situation and uncertainty around some countries, such as France, and their attitude towards trade.
“The opportunity to get a trade deal with the EU is now,” he said.
There had been fears New Zealand primary industries and cheesemakers would be big losers under the deal, with cheesemakers being forced to stop using names such as parmesan, gouda, halloumi, mozzarella, brie and camembert, which the EU sought to protect for use by European producers under its system of geographic indicators, or GIS.
Those fears have not been realised in full, with New Zealand retaining the right to use the names
of many famous cheeses.
New Zealand cheesemakers can still call their cheeses camembert, gouda, halloumi, mozzarella and brie.
Producers who are currently making parmesan can continue to use the name, though no more will be able to, once the agreement comes into force — when that happens, the only new producers of parmesan will have to come from the Italian region of Parma.
Producers who have been making gruyere for more than five years will continue to be able to use the term, but no one else apart from its traditional European manufacturers will. The only losers from the GIS deal are producers of feta and port, who will have to drop the terms within nine years of the deal coming into force.
New Zealand has secured some wins for primary industries, but some in the sector have said it is not enough.
Dairy and beef are expected to get $120 million of new export
revenue from when the agreement enters into force, growing to $600m within seven years. On beef, for example, New Zealand will be allowed to export 10,000 tonnes to the European Union at a tariff of 7.5 per cent a year.
Sirma Karapeeva, chief executive of the Meat Industry Association said she was “extremely disappointed” the deal did not include “commercially meaningful access for our exporters”.
Beef + Lamb chief executive Sam Mcivor said the deal was a missed opportunity to “return better prices to both companies and farmers”, and said the EU had failed to “live up to their rhetoric of being free traders”.
Big winners in the deal include the kiwifruit and seafood industries.
On day one of the agreement, kiwifruit, wine, onions, apples, ma¯nuka honey and manufactured goods will receive tariff-free access to the European single market.