The EU and New Zealand need to open negotiations on a free trade agreement, writes Chris Harris from the National Farmers’ Union Conference in Birmingham.
In his address to the conference, the New Zealand High Commissioner, Sir Lockwood Smith said that New Zealand was only one of six members of the World Trade Organization that had not opened free trade negotiations with the EU.
“In New Zealand, the EU has a like-minded partner strategically located in the Asia Pacific region,” said Sir Lockwood.
“Because of our experience with Asia and our integration into their economies, New Zealand offers Europe a unique opportunity as a partner.
“That’s why it makes no sense for New Zealand to be one of only six members of the WTO with no trade agreement with Europe and not yet negotiating one.”
Sir Lockwood added: “We might be small in European production terms, but our economic and political success with Asia is highly significant.
“A free trade agreement would be of benefit to Europe as it would to New Zealand.
It could be the highest quality and most comprehensive agreement the EU had.”
Sir Lockwood said the benefits that New Zealand could bring to a trade agreement with the EU stem from the way the country’s agricultural industry had changed and turned around over the last 30 years.
He said the country had changed from an agricultural sector with wine lakes and surpluses of lamb reliant on subsidies and protectionism to one that relied on market forces and was competing on the global market.
He said that the subsidies in New Zealand in the 1970’s amounted to 34 per cent forcing sheep numbers and production up but in a market where New Zealand could not compete because of quotas and high tariffs.
Cutting subsidies, wine tariffs and protectionism had an impact on the growth and quality of the wine sector and a drop in sheep numbers, but an increase in lambing percentages and carcase weights.
“Lambing percentages have increase 23 per cent, lamb carcase weights by 27 per cent and weight of lamb sold in kilograms per ewe has increased a massive 89 per cent” Sir Lockwood said.
“Milk solids per dairy cow have also increased 31 per cent”
He said that in the last 15 years New Zealand’s food and beverage exports have grown at a compound annual rate of 8.3 per cent a year.
For processed foods the compound average growth rate has been 15 per cent for the last 10 years.
Sir Lockwood told the conference that New Zealand had also embraced trade liberalisation forming agreements with the South East Asian countries – ASEAN and helping to sign China up into the World Trade Organisation.
He said the main stays of the trade agreements arranged by New Zealand were the Regional Comprehensive Economic Partnership (RCEP) and the Trans Pacific Partnership.
However, he added: “The WTO must remain the priority for comprehensive trade liberalisation and it’s crucial our regional negotiations are building blocks not stumbling blocks to the multilateral system,” he said.
Sir Lockwood added:” The New Zealand story in Asia shows that modern free trade agreements can be even more than vehicles for economic integration into supply chains and markets. They can also enhance strategic political outcomes.
“We share a great deal of agricultural expertise with the UK.
“An EU/NZ Free Trade Agreement could provide the vehicle needed for the kind of strategic investment and integration of activities in supply chains and markets that couldn’t help but benefit us all.
“The longer we delay, the more likely others will grasp the opportunities.”