EU seals free trade deal with New Zealand – but it’s ‘a real rarity’

The European Parliament has ratified a trade deal with New Zealand which will remove 100 percent of tariffs on exports from the bloc.

However, sceptics have pointed out the agreement is only the second since 2019 – the start of the most recent legislative term.

The Free Trade Agreement (FTA), which will also lift 98.5 percent of EU tariffs on New Zealand trade after seven years, was approved at Wednesday’s plenary in Strasbourg, with 524 votes in favour, 85 against and 21 abstentions.

Described by MEPs as a “gold standard” agreement, the deal is the EU’s first to include enforceable commitments to the Paris Agreement and to core International Labour Organisation (ILO) standards.

Bilateral trade in goods between the EU and New Zealand hit £7.92 billion (€9.1 billion) last year, with the EU being New Zealand’s third-largest trade partner.

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As a result of the agreement, trade is expected to increase by 30 percent, according to the EU Commission.

EU investment flows into New Zealand are also predicted to increase by more than 80 percent.

Rapporteur Daniel Caspary, an MEP for the European People’s Party, said: “Today is a good day for the EU and global rule-based trade.

“Our vote is a very clear signal of our commitment to negotiating new EU free trade agreements, of which we have seen too few in this parliamentary term. While we live at different ends of the world, the EU and New Zealand are close, trusted, reliable and like-minded partners.

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“Together, we are driving global rules-based trade forward against the backdrop of a worldwide wave of protectionism and isolationism.”

Speaking in the chamber on Tuesday, Bernd Lange MPE of the Socialists and Democrats group, chair of the International Trade Committee, said: “I am a proud chair of the International Trade Committee today.

“Because in this global world of fragmentation, we managed to agree on the most progressive and sustainable trade agreement by the European Union ever. This is a big success.”

Member states are expected to give their formal approval on Monday. Once the agreement is ratified by New Zealand, it can then enter into force, likely by mid-2024.

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The Group of European Conservatives and Reformists (ECR) was less unequivocal.

ECR shadow rapporteur Jan Zahradil MEP, speaking in the same debate on Tuesday, acknowledged: “It deepens our relations with the Indo-Pacific and it strengthens ties with our like-minded ally. All this is good news.

However, he continued: “Unfortunately also rare news, because we did not finish too many trade deals during this legislature.

“In less than six months this European Parliament comes to an end, so this is one of the last chances for us to show up.”

The only other deal to be struck since the last European elections was with Vietnam.

Geert Bourgeois MEP, the ECR Group’s coordinator in the Committee on International Trade, told colleagues: “Trade agreements bring growth and prosperity.

“They help our supply chains’ diversity; they bring stability and bring people together.”

He urged the bloc to “work more pragmatically on trade, working as a partner rather than imposing itself on third countries and threatening them with sanctions”.

Britain unveiled its own trade deal with New Zealand in 2021.

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