The UK’s newly-signed free trade agreement with agriculture powerhouse New Zealand has drawn a mixed reaction, with drinks exporters lauding the deal but farmers’ groups echoing criticisms of the government’s similar pact with Australia.
Trade secretary Anne-Marie Trevelyan said the New Zealand FTA, which was agreed last year and signed this week, would “slash red tape, remove all tariffs and make it easier for our services companies to set up and prosper in New Zealand”.
Wine and Spirit Trade Association CEO Miles Beale congratulated Trevelyan’s ministry for signing a “very good deal for the wine and spirit industry”.
The agreement, Beale said, would “support investment and jobs in the UK, and lead to tangible benefits for wine and spirit consumers”.
And according to Mike Cherry, the Federation of Small Businesses’ national chair, the deal was “a great step forward” as “New Zealand is a key market for UK small businesses”.
“Close to a third of smaller exporters already have ties to the nation,” Cherry added.
The Scotch Whisky Association’s international director Ian McKendrick agreed, saying the trade deal “was great news for our industry, in particular the commitment to strengthen protection of the whisky category in New Zealand”.
However, NFU president Minette Batters said the agreement posed a “real risk” to farmers in the UK.
“UK farm businesses face significantly higher costs of production than farmers in New Zealand, and margins are likely to tighten further in the face of rising input costs, higher energy bills and labour shortages,” Batters said.
“Even for sensitive sectors like beef and lamb, dairy and horticulture, in time there will be no limit to the amount of goods New Zealand can export to the UK,” she warned.
National Sheep Association chief Phil Stocker backed Batters’ assessment, adding that the agreements with Australia and New Zealand meant UK farmers would be pitted against rivals from the world’s two biggest lamb exporters.
In time, Stocker warned, the combined permitted lamb imports from both nations would reach “almost the total volume of lamb consumed here in Britain”.
The agreements meant the UK was opening itself “to a level of risk that could come and bite us in years to come”, Stocker added.
Stocker’s New Zealand counterparts welcomed the signing, with Meat Industry Association CEO Sirma Karapeeva saying the deal would “deliver a major boost for sheep and beef farmers and exporters”.
According to the AHDB, which does not expect the deal to be ratified until next year, New Zealand agreed “to eliminate all tariffs on UK products entering the country from day one of the agreement entering into force”.
“n return, the UK has agreed to eliminate 96.7% of tariffs for NZ products entering the UK from day one.
“Exceptions are the UK’s sensitive agricultural products, including beef, sheepmeat and cheese,” which are to be subject to transitional tariff rate quotas, the AHDB said.
Angus Brendan MacNeil, chair of the parliamentary International Trade Committee, said although the possible jump in overall trade with New Zealand was ”a welcome prospect”, the committee would “scrutinise” the deal amid concerns about “the speed at which tariffs will be removed for some agricultural products”.
The deal returns to New Zealand the tariff-free access to the British economy it had prior to the UK joining the then European Economic Community in 1973, which meant the UK ditching the trade system in place with Commonwealth nations.
Since its 2016 vote on leaving the bloc, which had in the meantime been revamped into the European Union, the UK has sought new or replacement trade deals for those it was party to as an EU member and recently started FTA talks with India.
