New Zealand’s wine industry welcomes UK FTA negotiations

The New Zealand wine sector has “warmly welcomed” news that the UK and New Zealand will start negotiations to establish a free trade agreement (FTA).

Jeffrey Clarke, general manager of advocacy and general counsel at New Zealand Winegrowers, said the move could present a “great opportunity for both countries”.

As part of a speech delivered earlier this month, the UK Prime Minister, Boris Johnson, said: “There’s so much we already do. I mean let’s face it, we buy colossal quantities of New Zealand wine – fantastic Oyster Bay…we export gin, we export buses to New Zealand – but frankly there’s so much more we could do together, from agriculture to services.”

The UK stated that the removal of tariffs would reduce the cost of exporting, support the creation of jobs, and boost “two way trade in goods and services worth £2.9 billion in 2019.

The first round of UK-New Zealand FTA (virtual) negotiations will begin on 13 July. The UK is the fifth larger investor in New Zealand and the country’s sixth-largest trading partner.

The Wine and Spirit Trade Association (WSTA) has previously called for the removal of tariffs on both New Zealand and Australian wine. Back in 2018, it stated that customs tariffs on wines entering the UK from Australia and New Zealand amounted to some £35m in 2016.

Clarke of New Zealand Winegrowers stressed that the UK was an important market for New Zealand wine.

He said: “UK consumers were among the first to fall in love with our distinctive wines, and our wineries have worked hard at keeping that excitement alive. As a result, wine is now the most valuable Kiwi export to the UK – accounting for over 30% of the value of all New Zealand exports to the UK, and providing high quality jobs and over $440 million of income for our wine regions in 2019.

“Wine trade with the UK is currently hampered by costly, pointless EU certifications and complex rules erected to protect EU wineries. The UK now has a chance to sweep away those barriers and enhance its status as a global wine trade hub.”

Clarke has also called for the UK to sign up to the Comprehensive and Progressive Agreement on Trans Pacific Partnership, and participate in groups including the World Wine Trade Group.

He did, however, note that he had been disheartened by New Zealand’s FTA negotiations with the EU, negotiations which were formally launched in 2018.

He said: “The current FTA negotiations with the European Union have been disappointing. Their opening ask on Geographical Indications was pretty extreme, and suggests they are not really that interested in being flexible. We will be crossing our fingers that our UK friends will be coming with a fresh attitude, and a willingness to consider powerful modern approaches to simplifying trade, like mutual recognition.”

The UK has announced that it will open similar negotiations with Australia, which has likewise been welcomed by members of the Australian wine community.