The European Union and New Zealand have struck a trade deal, which it is claimed will provide “significant economic opportunities” for farmers, companies and consumers.
The agreement removes all tariffs on EU agri-food exports to New Zealand including some dairy products, pigmeat, wine, chocolate and pet food.
The move could cut around €140 million a year in duties for EU companies.
Bilateral trade is expected to grow by up to 30%, with EU annual exports potentially growing by up to €4.5 billion.
The deal also extends the protection of EU traditional foodstuffs in New Zealand through the adoption of the EU Geographical Indications (GI) system.
This includes Irish whiskey, Connemara Hill Lamb, Sneem Black Pudding and the Waterford Blaa.
The EU noted that it is “very carefully opening” its market for New Zealand imports of agri-food products, with limited access for “sensitive products”, including several dairy products, beef and sheep meat, ethanol and sweetcorn.
Under the agreement, the EU will allow a tariff rate quota of 10,000t of beef to be imported with reduced duty of 7.5%.
This volume will be gradually phased in over seven years from when the deal comes into force.
The EU said that this “modest volume” recognises the “particular sensitivity of the beef sector” and is limited to high-quality grass fed beef which has higher costs of production and sustainability credentials.
Meanwhile, the EU will apply a quota of 38,000t of sheep meat to be imported duty free, again to be phased in over seven years.
The deal outlines limits for imports from New Zealand of certain dairy products including a quota of 15,000t for milk powders on a 20% most favored nation (MFN) tariff.
New Zealand has currently access to a quota of 47,177 t of butter at tariff rate of 38%, 21,000t of this will be gradually reduced to 5% of the MFN duty.
An additional 15,000t will be allowed by the EU on the new tariff rate.
The deal will allow for 25,000t of cheese to be imported into the EU from New Zealand duty free, phased in over a seven-year period.
Access through tariff rate quotas will be granted for 3,500t of high-protein whey.
Sustainability
The trade deal also includes sustainability commitments which are enforceable through sanctions, as a last resort.
The parties have agreed to work togethers on animal welfare, food, pesticides and fertilisers.
They will also cooperate to ensure the security and resilience of supply chains.
It was noted that EU health and food safety rules apply to all products sold in the bloc,
whether produced domestically or imported.
Commenting on the deal, European Commission president, Ursula von der Leyen, said:
“New Zealand is a key partner for us in the Indo-Pacific region. This trade agreement brings major opportunities for our companies, our farmers and our consumers, on both sides.
“It can help increase trade between us by 30%. It includes unprecedented social and climate commitments.
“This new agreement between the European Union and New Zealand comes at an important geopolitical moment. Democracies – like ours – work together and deliver for people,” von der Leyen said.