EU and New Zealand discuss liberalising trade between them

The EU is to open preparatory talks with New Zealand on a new trade agreement with the aim of liberalising trade between them.

The announcement came following meetings between European Commission president Jean-Claude Juncker, European Council president Donald Tusk and New Zealand prime minister John Key in Brussels yesterday.

The European Commission has been tasked with undertaking an impact assessment on the benefits of a possible free trade agreement (FTA), although the launch of full negotiations would need the unanimous support of all member states, and would be unlikely to commence before early 2017.

Agriculture is likely to be a sensitive issue in the negotiations given New Zealand’s status as one of the world’s biggest dairy producers. However, officials said significant duty-free arrangements already existed.

EU trade commissioner Cecilia Malmstrom this month launched a trade strategy paper highlighting the European Commission's commitment to adopt a new trade strategy "to take account of the new economic realities" including globalisation.

Securing a mandate for FTA negotiations with new partners such as New Zealand in the Asia-Pacific regions were among the priorities highlighted.

Discussions

In a joint statement after yesterday’s meeting the heads of the European council and commission and Mr Key said discussions on the scope of the negotiations should start “as soon as possible”.

“Today we committed to start the process for negotiations to achieve swiftly a deep and comprehensive high-quality free trade agreement. Discussions to define the scope and overall approach to the negotiations should start as soon as possible...We believe that a FTA will support sustainable growth and investment, opening up new trade and business opportunities and generating new employment for our peoples.”

The EU is currently involved in a major free trade negotiation with the US, although it is becoming increasingly unlikely that the Transatlantic Trade and Investment Partnership (TTIP) will be completed during the term of President Barack Obama.

This week proponents of a British exit from the EU were dealt a blow when the US chief negotiator in the talks warned that Britain would not be able to negotiate its own free trade agreement with the US should it leave the European Union.

Platforms

“We’re not particularly in the market for FTAs with individual countries. We’re building platforms…that other countries can join over time,”

Michael Froman

said in an interview.

Critics of Britain’s membership of the EU have long argued that Britain would be in a position to negotiate its own bilateral trade agreements on favourable terms if it chose to leave the bloc in the forthcoming referendum on EU membership.