November 2, 2015


NZ dairy, meat sectors welcome talks toward free trade deal with EU



New Zealand's dairy and red meat industries have welcomed a proposed free trade agreement (FTA) between the country and the 28-nation bloc European Union.


The European Commission announced that EC President Jean-Claude Juncker and European Council President Donald Tusk met with Prime Minister John Key of New Zealand on Thursday, October 29, to discuss the possibility to further develop trade and economic relations between the EU and New Zealand.


Miles Hurrell, group director of co-operative affairs, Fonterra, said, "This is an important first step towards a comprehensive and high-quality free trade agreement with the EU. We have free trade agreements with almost all of our other major trading partners, so this really is the missing piece".


Hurrell added that an EU FTA would benefit New Zealand farmers and be mutually beneficial for dairy players in Europe and New Zealand.


Fonterra has significant investment in operations in Europe while several European dairy companies have interests in New Zealand.


"This is the logical next step in New Zealand's close relationship with Europe and we look forward to the commencement of the negotiations," said Hurrell.


Meat sector 'delighted'


Beef + Lamb New Zealand and the Meat Industry Association also expressed "delight" that the EU and New Zealand have initiated negotiations for an FTA.


Beef + Lamb New Zealand chairman James Parsons said New Zealand still faces a range of significant tariff and non-tariff barriers in this market, as the country pays around NZ$70 million (US$47.3 million) in tariffs per year on its red meat exports to the EU.


"In addition, many of our competitors in this market have already reached free trade agreements with the EU, such as Canada, or are already in the process of negotiating, such as the United States. New Zealand is one of only six World Trade Organisation member countries that had yet to enter into trade negotiations with the EU", Parson said.


Meat Industry Association chairman Bill Falconer, for his part, said, "Securing an FTA with the European Union is the logical next step in strengthening our trade relationship. It will not only create a more formal trade framework but will also support greater participation in global value chains by both sides".


During their October 29 meeting, Juncker, Tusk and Prime Minister Key said in a joint statement: "The European Union and New Zealand are longstanding and close partners. We share core values, common interests and a growing and mutually beneficial trade and economic relationship, reinforced by strong people-to-people and cultural ties. We came together today to agree to further deepen our political, security, trade and investment relations. 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. In parallel with this, we agreed to take steps to seek the necessary authorisation for the negotiations on the basis of a successful scoping. We believe that an FTA will support sustainable growth and investment, opening up new trade and business opportunities and generating new employment for our peoples."

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