It is good news for Kiwi exporters as New Zealand reaches a post-Brexit deal with the UK that will see tariffs eliminated on goods exported to the kingdom. This arrangement will result in tariffs ending on as much as 97% of product lines that would affect 63% of current exports to the UK. It will apply to many of New Zealand’s key exports including beef and sheep products, wine, honey, apples, and some industrial products. For some products, the end in tariffs will however take several years to come into effect.
As part of the deal, New Zealand will also eliminate tariffs on UK imports into the country. In adherence to the government’s commitment to climate change and animal welfare, this arrangement will also include provisions that ensure these imports are not part of environmentally harmful activities like overfishing. This deal is set to take effect from the first day of signing.
The deal is for the time being an agreement in principle and is the culmination of 16 months of negotiation. PM Jacinda Ardern hopes that the deal will be finalised in the coming months and will be in effect by next year. Transitional duty-free quotas will however be applied in the meantime, with the volumes expected to be gradually increased with time and dependent on the industry. The deal also makes New Zealand the second country after Australia to secure a Free Trade Deal with the UK.
During its announcement, PM Ardern noted that this market access outcome was one of the best trade deals the country had secured at a crucial time during the country’s Covid recovery. She said it would help to force a stronger and more dynamic future relationship between the nations and their partners. UK’s Boris Johnson also voiced praise for the deal, saying it was good for both economies and would boost jobs and growth as the countries recovered from the pandemic.
Some interested parties are however not as happy with the deal. UK farmers have expressed disappointment with the deals as they feel this would allow cheap imports into the country. Johnson has however said that this deal would allow British consumers access beloved New Zealand products more affordably, from Manuka honey to Sauvignon Blanc wines. With trade between the countries amounting to about £2.3 billion in 2020, which accounts for just 0.2% of their total trade, the UK government does not expect this new deal to affect GDP.
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