UK Free Trade Agreement with New Zealand: What You Need to Know
As the United Kingdom (UK) navigates the post-Brexit world, it has been actively pursuing free trade agreements with countries around the world. One of the latest agreements on the horizon is between the UK and New Zealand. This potential agreement has garnered attention from businesses and individuals alike, as it could have significant implications for trade between the two countries. Here`s what you need to know about the UK free trade agreement with New Zealand.
What is a free trade agreement?
A free trade agreement (FTA) is a type of trade agreement that eliminates tariffs, quotas, and other trade barriers between countries. FTAs are designed to increase trade and investment, boost economic growth, and create new job opportunities. They also help to streamline trade processes and reduce bureaucracy, making it easier for businesses to trade with each other.
Why is the UK pursuing an FTA with New Zealand?
New Zealand is a small but economically prosperous country with a long-standing history of trade with the UK. In 2019, the UK was New Zealand`s fifth-largest trading partner, with bilateral trade valued at NZD 6.1 billion. An FTA between the two countries could further strengthen these trade ties and open up new opportunities for businesses in a range of sectors, including agriculture, manufacturing, tourism, and services.
What are the potential benefits of a UK-New Zealand FTA?
A UK-New Zealand FTA could bring a range of benefits to both countries. For the UK, it could mean increased access to New Zealand`s agricultural and food markets, which are known for their high quality and sustainable practices. It could also provide new opportunities for UK businesses in sectors such as technology, finance, and professional services.
For New Zealand, an FTA with the UK could help to diversify its export markets and reduce its reliance on Australia and China. It could also provide new opportunities for New Zealand businesses in sectors such as education, tourism, and creative industries.
What are the challenges facing a UK-New Zealand FTA?
While there are potential benefits to a UK-New Zealand FTA, there are also challenges to overcome. One of the main challenges is the geographical distance between the two countries, which can make it difficult and expensive to transport goods and services. Another challenge is the issue of agricultural subsidies, which can distort trade and make it difficult for smaller producers to compete.
There are also concerns about the impact of a UK-New Zealand FTA on workers` rights, environmental protection, and animal welfare. As with any trade agreement, it is important to ensure that these issues are addressed and that the benefits of trade are shared fairly and equitably.
What`s next for the UK-New Zealand FTA?
Negotiations for a UK-New Zealand FTA began in June 2020 and are ongoing. Both countries have expressed a desire to finalize an agreement as soon as possible, but the process is likely to take some time. Once a draft agreement is reached, it will need to be ratified by both countries` parliaments before it can come into force.
In conclusion, a UK-New Zealand FTA has the potential to bring significant benefits to both countries, but there are also challenges to overcome. As negotiations continue, it will be important to ensure that workers` rights, environmental protection, and animal welfare are protected, and that the benefits of trade are shared fairly and equitably.
