UK – New Zealand Free Trade Agreement: Key Facts & Benefits
On the 31st of May 2023, UK’s new free trade agreement with New Zealand comes into force. It’ll be the second free trade agreement negotiated independently by the UK since leaving the EU.
UK businesses will be able to take advantage of the Free Trade Agreement with New Zealand from the 31st of May, 2023. And although it’s not the biggest market, it can offer many opportunities for UK traders.
We put together a video explaining the benefits of the FTA. You can watch it below, or keep reading this blog post to learn more!
According to the Institute of Export and International Trade, 58% of exporters currently export to New Zealand, and 25% plan to start.
UK-NZ Trade: Key Facts & Figures
- In 2022, New Zealand’s trade with the UK amounted to £2.5 billion. That’s a 14.6% increase from 2021.
- The total value of UK exports to New Zealand was £1.6 billion in 2022. That’s 30.5% more than in 2021.
- The UK exported goods worth over £854 million to New Zealand in 2022, with vehicles making up the biggest share (£178 million).
- The new FTA is expected to boost the UK economy by £800 million and contribute £200 million to wages in the long term.
- The FTA is expected to reduce customs duties by £17 million.
UK-NZ FTA: Key Benefits
Duty-Free
99% of goods moving between the UK and New Zealand will be duty-free – provided that the exporters qualify and have documentary confirmation of the relevant qualifications. These goods include wine, honey, onions, and, of course, kiwi!
Quick Customs Clearance
Under the FTA, goods must be released within 48 hours of arrival at the New Zealand border and within 6 hours if they’re perishable. There’s also no need for customs brokers anymore – although CDS is still necessary. And both countries have agreed to implement a Single Trade Window.
Rules of Origin
The FTA also provides clear guidance on rules of origin which has been tailored to supply chains prevalent in both countries. Origin can be proven by a planned self-certification procedure – an update will be provided by New Zealand in due course.
Digital Co-operation
Under the FTA, there will be no customs duties on software transfer, and the UK traders looking to establish a business in New Zealand won’t have to implement any data localization procedures. In addition, the agreement provides for improvements in digital trade, IP cooperation, and the free flow of data between the two countries.
Public Procurement
Under the FTA, UK traders will have the opportunity to participate in New Zealand government commercial procurement contracts on the same playing field as local traders. Both countries promise to support and facilitate the access of SMEs to public procurement.
Business Mobility
The FTA will also allow mutual recognition of professional qualifications, provide a new visa route for UK professionals, and other business mobility advantages for British expats in New Zealand.
Sustainability
And finally, there are two more very important aspects of the FTA.
The first is cooperation between the UK and New Zealand on sustainability and environmental issues, and the promotion of trade in environmental goods and services, which includes the removal of tariffs on goods such as electric vehicles and wind turbine parts.
The second is additional support for female and Māori business owners.
We welcome this free trade agreement and look forward to seeing its benefits come to fruition.
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