The UK has very recently agreed a free trade deal with New Zealand with a view to cutting export costs and opening up New Zealand’s job market to UK lawyers and other professionals.
Whilst only a very small proportion of UK trade is done with New Zealand (less than 0.2%), the political significance of this deal far outweighs its economic significance and shows that the UK is continuing to negotiate post-Brexit trade deals beyond Europe.
This deal is the second bespoke post-Brexit trade deal for the UK and came about after only 15 months of negotiations. Tariffs as high as 10% will be removed on a huge range of UK goods. British exporters will have an advantage in the New Zealand import market - a market which is expected to grow by around 30% by 2030. Amongst many things included in the deal such as more cooperation on digital trade and climate change, rugby enthusiasts will be interested to know that this deal will protect The Haka from being misused for commercial purposes.
The UK and the CPTPP
As with the UK’s first big post-Brexit trade deal with Japan in October 2020 – which was the first that differed from an existing EU deal – and the trade deal struck with Australia in June, the UK hopes that the New Zealand deal is another step towards being accepted as a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to which it formally applied earlier this year. The CPTPP is a trade bloc of 11 nations which include Japan, Australia and New Zealand as well as Canada and Mexico among others. The combined GDP for these 11 nations was £8.4trn in 2020.
Whilst the UK already has trade agreements with many of the bloc’s members, which were rolled over from when it was in the EU, CPTPP membership would give the UK more access in terms of digital trade and services. Indeed, the UK has negotiated rollover deals with 63 of these countries.
Additional UK Trade Agreements
A trade agreement with Norway, Iceland and Liechtenstein was also announced in June, and this builds on the EU rollover deal which came into force on 1 January. The UK government also wants a separate deal with Canada to replace the EU rollover treaty it already has. In the longer term, the UK government also wants what would be a very important deal with India but this is likely to be a long and protracted process. A trade deal with the USA is also of particular importance. However, whilst the US is already a significant UK trading partner, and accounts for one sixth of British trade, the US government has played down an imminent UK-US trade deal. That said, smaller deals have already been reached with the US (including in relation to British beef).
About the Author
Moray Hughes is a highly experienced litigator and dispute resolution lawyer who was admitted as a Solicitor in England & Wales in 1980 following two years spent as a trainee at Norton Rose. Moray deals with commercial and contractual disputes of a domestic and cross-border and multi-jurisdictional nature, and has practiced in the City of London for many years at a number of leading firms including Hill Dickinson and Simmons & Simmons, as well as in Hong Kong and in Australia where he was admitted as a Solicitor in New South Wales in 1984.
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