Trade update – August
August Trade Update
All ports are operating and both imports and exports are being loaded and unloaded. Freight is considered an essential service and even non-essential products are able to be transported to and from ports. Production and harvesting of these products may be a different matter. The forestry sector is one where some issues are being experienced. These are being worked through.
On the trade policy front the focus is squarely on the New Zealand – United Kingdom Free Trade Agreement negotiations.
Negotiations are now pretty much continuous as both sides strive to reach agreement in principle by the end of the month (it is still unclear whether New Zealand’s Level 4 lockdown) might impact this timing.
The UK is essentially saying that it would be prepared to offer a deal to New Zealand comparable to that it has agreed with Australia if New Zealand is able to meet most of the UK requests on services and investment. The New Zealand negotiators have received a revised mandate and this has allowed negotiations to progress.
It seems that positions are narrowing and much will now depend on engagement at Ministerial level. This is pending.
As we write it is still unclear whether the UK is actually offering New Zealand as good a deal as has been offered Australia. There are some very technical discussions going on about exactly how the proposed tariff quota regime for key agricultural exports (meat and dairy) will operate. There is also some question about the end point of liberalisation eg will there be, eventually, a zero tariff for all products or will a low tariff remain in place. And will the tariff quotas all be transitionary or will some remain in place permanently? In the case of Australia the end point was “zero tariffs” and the tariff quotas disappear over time. New Zealand clearly has the same expectation.
There will no doubt be public comment from both governments before the end of the month.
With the EU summer break about to end the NZ-EU negotiation should be resuming shortly.