NZ-EU trade agreement is great news for sustainability
It’s been a long time coming! In July, New Zealand signed a free trade agreement (FTA) with the European Union. Good news for manufacturers too. New Zealand’s exports of goods to its fourth largest trading partner were worth NZD4.68b in 2022. These goods included many manufactured products – machinery, medical appliances, food products, plastics, aluminium and others. More than 91% of New Zealand’s trade into the EU will enter duty-free when the FTA comes into force (expected to be in the first half of 2024). Many goods, including some manufactured products, will have no tariffs at all from this date. This means many millions of dollars of tariff savings each year on exports to the EU. After seven years, when the agreement is fully in place, 97% of current trade will enter the EU duty-free. How the new FTA promotes sustainability The FTA will make trade more sustainable and create opportunities for businesses that deliver more sustainable products. The agreement is the first FTA built around the EU’s ’Together for Green and Just Growth’ approach to trade and sustainable development. It contains ambitious sustainable trade outcomes in many areas. Environmental outcomes include addressing climate change and subsidies on fossil fuel. Social outcomes include promoting labour rights and women’s economic empowerment. The upside for manufacturers – and some warnings The FTA will have a big impact on trade between New Zealand and the EU. The potential upside for local manufacturers is significant: easier access to one of the world’s most lucrative trading blocs; lower costs for materials imported from the EU. However, the FTA comes with warnings too. Firstly, local manufacturers will be competing with EU manufacturers who may have been making their products more sustainable for some years. As customers here and in the EU prioritise ‘responsible purchasing’, make sure […]