The EU-New Zealand trade agreement has today taken a big step towards ratification, with the Commission sending it to Council for signature.
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Sending the draft decisions to the Council on the signature and conclusion of the agreement is a major step: once the Council gives its green light, the EU and New Zealand can sign the agreement and it can be sent to the European Parliament for its consent.
Following approval, the deal can enter into force.
The agreement is expected to deliver major gains for the EU. Bilateral trade is expected to grow by up to 30% thanks to this deal, with EU annual exports potentially growing by up to €4.5 billion.
EU investment into New Zealand has a potential to grow by up to 80%. The deal can cut some €140 million a year in duties for EU companies from the first year of application.
Open trade is one of the four pillars of the EU's Green Deal Industrial Plan announced by President von der Leyen on 1 February 2023, and this agreement will make a contribution. Once in force, it will help make the EU economy greener, more competitive and more resilient.
The agreement will provide new opportunities for businesses by:
• Eliminating all tariffs on EU exports to New Zealand;
• Opening the New Zealand services market in key sectors such as financial services, telecommunications, maritime transport and delivery services;
• Ensuring non-discriminatory treatment to EU investors in New Zealand and vice versa;
• Improving access for EU companies to New Zealand government procurement contracts for goods, services, works and works concessions;
• Facilitating data flows, predictable and transparent rules for digital trade and secure online environment for consumers;
• Preventing unjustified data localisation requirements and maintaining high standards of personal data protection;
• Helping small businesses export more through a dedicated chapter on small and medium enterprises;
• Significantly reducing compliance requirements and procedures to allow for quicker flow of goods;
• Significant commitments by New Zealand to protect and enforce intellectual property rights, aligned with EU standards.
EU farmers will have much better opportunities to sell their produce in New Zealand immediately upon application of the agreement. Tariffs will be eliminated as of day one on key EU exports such as pigmeat, wine and sparkling wine, chocolate, sugar confectionary and biscuits.
EU farmers will see benefits beyond the tariff cuts. The Agreement will protect the full list of EU wines and spirits (close to 2000 names) such as Prosecco, Polish Vodka, Rioja, Champagne and Tokaji.
The agreement takes into account the interests of EU producers of sensitive agricultural products: several dairy products, beef and sheep meat, ethanol and sweetcorn.
For these sectors, there will be no liberalisation of trade. Instead, the agreement will allow zero or lower tariff imports from New Zealand only in limited amounts (through so-called Tariff Rate Quotas).
The EU-New Zealand Trade Agreement is the first one to integrate the EU's new approach to trade and sustainable development announced in the Communication “The power of trade partnerships: together for green and just economic growthâ€, adopted just a week before the negotiations of the trade agreement were concluded in June 2022.
Both sides agreed to ambitious TSD commitments covering a wide range of issues based on cooperation and strengthened enforcement, including the possibility of sanctions as a last resort in case of serious violations of core labour principles or of the Paris Agreement.
For the first time ever in an EU trade agreement, the deal has a dedicated sustainable food systems chapter, a dedicated trade and gender equality article and a specific provision on trade and fossil fuel subsidies reform. The deal also liberalises environmental goods and services at entry into force.
This is in line with recommendations received from citizens coming out of the Conference on the Future of Europe, to promote sustainable trade while opening up new opportunities for European companies. ■