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The EU-New Zealand Free Trade Agreement will enter into force on 1 May 2024

On 25 March 2024, New Zealand notified the EU that it has completed the ratification process for the EU-New Zealand Free Trade Agreement (EU-NZ FTA). The Treaty will enter into force on 1 May 2024. The ratification process has been completed in the New Zealand Parliament with the issuance of the "Royal Assent". Negotiations on the treaty took place over four years in 12 rounds and were concluded on 30 June 2022. This was the fastest FTA negotiation process on the EU side. The treaty was signed on 9 July 2023 in Brussels. The ratification process of the document was completed in the European Parliament in November 2023.

For EU exporters, the New Zealand market will be opened to duty-free imports on the date of entry into force of the treaty on 1 May 2024. European companies will save €140 million a year in tariffs. Tariffs currently in place, up to 10%, will be removed on industrial and agricultural products including motor vehicles, machinery, pharmaceuticals, wine and chocolate. For NZ companies, on the other hand, 91 % of trade in goods will be eliminated once the treaty enters into force, rising to 97 % within seven years. This will apply to fish and seafood, wine, honey, kiwi, apples, onions, etc. NZ exporters will save 46 million NZD a year on kiwifruit and onion exports to the EU alone, for total exports to the EU it will be 100 million NZD. Imports of meat and dairy products to the EU, so sensitive for European farmers, will be subject to quotas. Bilateral trade is expected to increase by 30 % over the next decade.  

For both sides, this is a "new generation" free trade agreement that includes a chapter on sustainable food systems or gender equality. For the EU, the treaty includes for the first time a commitment on harmful fisheries subsidies or the issue of sustainable development. The chapter on services will make it easier for EU firms to provide their services in NZ and vice versa.

The FTA provides for non-discriminatory access to investors from both sides, which could spur an 80 % increase in investment from the EU to NZ from the European side.It will also ensure that EU companies have the same access to public procurement on the same terms as domestic New Zealand companies.The treaty also addresses digital trade, more progressive IP enforcement and protection of European geographical indications (GIs) in NZ. And New Zealand wine GIs will be protected in the EU as well. The treaty includes support for small and medium-sized businesses and support for the economic activities of New Zealand's indigenous people.

In the last two years, Czech exports to NZ have been around CZK 3.4 billion annually, while imports have reached CZK 0.8 billion.  For Czech exporters, the entry into force of the EU-NZ FTA will facilitate exports to NZ of traditional items such as passenger cars, construction machinery, tyres, data processing machinery and equipment, agricultural machinery, plastic pipes, steel and iron products or toys. Prospects can also be seen in the export of energy equipment and systems, medical devices, ICT, robotics and Industry 4.0 equipment, or in the space industry, where NZ has the right conditions to send objects into orbit.

Czech companies interested in entering the New Zealand market and participating in economic diplomacy projects being prepared by the Czech Embassy in Canberra can contact the economic diplomat at milan.vagner@mzv.gov.cz.

Milan Vágner, Economic Diplomat, Embassy of the Czech Republic in Canberra