Explore how the EU-New Zealand FTA opens new avenues for NZ dairy exports through increased quotas and lower tariffs. Will NZ dairy flourish amidst persistent limitations? Delve deeper to find out.
The EU-New Zealand Free Trade Agreement (FTA), which came into force on May 1, marks a pivotal moment for New Zealand’s dairy sector, expanding export possibilities while still imposing certain restrictions. Signed on July 9, 2023, in Brussels, this agreement has the potential to significantly boost New Zealand’s economy by removing duties on a vast majority of its goods exported to the European Union. Notably, the deal represents both an opportunity and a challenge for dairy exporters. At the same time, quotas and tariffs largely remain and are set to increase and decrease over time.
New Zealand dairy exporters stand to gain from the EU-New Zealand Free Trade Agreement. With the removal of duties on 91% of New Zealand’s exports to the EU starting from May 2024, and an increase to 97% within seven years, the prospects for dairy exports are promising. However, the road ahead is not without obstacles. Adapting to stringent EU regulations and standards, as well as dealing with existing restrictions and quota limitations, will be a challenge.
However, the path forward has its challenges. New Zealand’s dairy exporters compete with other dairy-exporting countries and must adapt to stringent EU regulations and standards. Furthermore, restrictions and quota limitations continue to pose supply chain challenges, necessitating strategic adjustments.
To make the most of the agreement, dairy exporters need to take strategic steps. These include enhancing product quality and differentiation, fostering strong relationships with EU importers, and diversifying market channels to manage risks. By doing so, they can position themselves effectively in this new trading environment.
The EU-New Zealand Free Trade Agreement offers substantial benefits for New Zealand’s dairy exporters, from increased market access to reduced tariffs. However, adapting to changes and seizing new opportunities will be crucial. Dairy exporters must leverage this agreement strategically to ensure sustainable growth and success in the competitive EU market.
Key Takeaways:
“This is a significant achievement for New Zealand and follows more than 15 years of lobbying, persuading, and negotiating,” said McClay.
- 91% of New Zealand’s goods exports to the EU will be duty-free from May 2024, increasing to 97% in seven years.
- Dairy sector will benefit from increased quota volumes and reduced in-quota tariff rates over time.
- New Zealand exporters are expected to save NZ$100 million annually on tariff elimination.
- The agreement aims to double New Zealand’s export value within the next decade.
