New Zealand will “intensify” free trade talks with the United Kingdom, as negotiations over market access for New Zealand’s agricultural products inch forward and Australia streaks ahead with its deal.
Trade Minister Damien O'Connor says he spoke with his British counterpart, Trade Secretary Liz Truss, by phone on Wednesday evening, and the pair agreed to accelerate negotiations in hope of settling a NZ-UK Free Trade Agreement “in the coming months”.
“Teams will now intensify talks, with chief negotiators meeting monthly and the next formal rounds of talks scheduled for early June and July,” O’Connor said, in a statement issued after the call.
The United Kingdom appears to have moved faster in free trade negotiations with Australia. After Truss met Australian trade minister Dan Tehan in person last month it was reported a deal could be signed at the G7 summit in June.
The UK began negotiating a deal with Australia on the same day as New Zealand in June 2020, and has been eager to close the bilateral deals to “set the tone” for how it will trade with the world post-Brexit.
New Zealand wants the removal of “prohibitively high” trade tariffs and access for agricultural products. The UK is New Zealand’s sixth largest trading partner, with two-way trade nearing $6 billion in 2019. But the country takes a small fraction, 2.5 per cent, of New Zealand’s total exports.
Trade negotiators completed a fourth round of talks on the free trade deal last week, thrashing out the bones of the whole agreement. But a second goods market access offer – the tariffs and quotas the United Kingdom would apply to New Zealand’s products – didn’t land.
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New Zealand had described the UK’s initial offer, which came earlier in the year, as having “key gaps”. O’Connor on Wednesday indicated the revised offer was insufficient.
“I also emphasised to secretary Truss that we still have a significant amount of work to ensure the market access outcomes, particularly for agriculture, reflect the ambition we have jointly set for the FTA – an ambitious, comprehensive deal that removes tariffs,” he said.
O’Connor said good progress had been made during the latest negotiations.
A statement issued by Truss’ office at the close of negotiations last week said “excellent progress was made on issues relating to trade and development across the agreement”.
Agreements had been reached on how to bolster trade for small and medium-sized enterprises, and trade remedies and competition.
On Tuesday, British High Commissioner to New Zealand Laura Clarke said in a statement that the progress was “a testament to the real momentum on both sides to agree an ambitious deal”.
“We’ve also agreed to a chapter devoted to women in trade, which aims to break down barriers and advance gender equality. And we remain committed to making progress on environmental issues, and on indigenous trade,” she said.
Speculation the NZ-UK deal had gained momentum reached the British tabloids last month, with The Sun reporting a source close to Truss saying deal that was making "rapid progress”.
Export associations in New Zealand were cautious, saying a deal was far from sealed and the report may have been a ploy to apply pressure on Australia. A week later, the Telegraph reported that Truss was heading into a “showdown” negotiation with Tehan, and was going to sit him in a “uncomfortable chair" to apply pressure.
