The announcement of a free trade agreement between New Zealand (NZ) and the European Union (EU) is warmly welcomed across the NZ horticulture exporting landscape as shared by a recent press release.
The horticulture industry in New Zealand and other countries has faced challenges due to the various lockdowns, global supply chain disruptions, and energy price hikes that have affected the financial results of most operators. According to the NZ Horticulture Authority: “The removal of trade-distorting tariffs will be good for the NZ horticulture export sectors by leveling the pitch with other southern hemisphere supplying countries. The EU consumers will benefit from the agreement enabling better security of access to healthy NZ food products.”
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“With the annual export value to the EU ranging from NZ$830 – 940 million (Fob) over the past three years and tariffs ranging from zero to 20% (depending on the item), the removal of tariffs on trade with the EU will provide an estimated benefit of approximately NZ$80m annually. This equates to the removal of approximately 60% of our entire annual horticulture tariff costs globally.” States the New Zealand Horticulture Export Authority CEO, Simon Hegarty.
The 27-member EU with its 445million population has been the leading destination for New Zealand’s horticulture trade profile for decades. Now dominated by the kiwifruit, apples, and onions trade, there are also a range of lesser-known NZ products (e.g. buttercup squash, apricots, frozen berries) that will stand to benefit from the removal of tariffs.
The agreement has however received mixed reviews in Europe with French Farmers fearing an unfair competition with New Zealand farms and subsequent economic regions/ countries.
“Neither the use by New Zealand farmers of herbicides classified as harmful to humans and banned in Europe since 2003, such as atrazine, nor the presence of palm oil cakes responsible for deforestation in the feed of New Zealand cows, nor the absence of regulatory obligations governing the transport of animals, appear to be obstacles to the arrival of New Zealand meat on the European market, with preferential customs duties, in the text under negotiation,” the union denounced.
“This first post-FEU (French Presidency of the European Union) free trade agreement will undoubtedly pave the way for the ratification of other agreements, including the much feared agreement with Mercosur, which is expected to be voted on by the EU Council by the end of the first half of 2023. It is therefore a test case”, fears the FNB.