After 16 months of negotiations, the draft contract became Britain’s post-EU brokerage contract.
“This is an excellent UK trade deal that will strengthen our longstanding friendship with New Zealand and further strengthen our relationship with the Indo-Pacific,” Prime Minister Boris Johnson said in a statement.
Trade between the UK and New Zealand was estimated at $2.3 billion ($3.2 billion) in 2020, less than 0.2% of all UK trade. According to the UK government’s own estimates, the deal is unlikely to boost UK GDP.
The signing of new trade deals is urgent as the UK seeks to offset the economic benefits of EU membership. By 2020, the EU accounted for 42% of exports and 50% of imports of British goods and services, and companies face new trade restrictions after Brexit.
The UK also has agreements with Japan and Norway, but they are based on agreements negotiated by the European Union.
Johnson said British consumers wanted affordable New Zealand products ranging from Savignon blanc to manuka honey and kiwifruit.
New Zealand Prime Minister Jacinta Artern described these countries as “best friends and close partners”.
“The historical ties that bind us are deeply rooted,” he said, adding that the trade deal was “good for our economies, our companies and our people.”
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