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Gisborne winemakers raise glasses to new free trade agreement

Gisborne winemakers are toasting a free trade agreement between the United Kingdom and New Zealand that also paves the way for Māori trade gains.

When the deal comes into force by the end of the year, tariffs will be eliminated from day one on wine, which has a New Zealand export value of $463.1 million, honey ($74.9m) and onions ($8m).

Tariffs will be eliminated for off-season exports for the first three years with all apple exports ($63.6m) tariff free after those three years.

GisVin, which exports wine to UK supermarkets as own-brand wine, has welcomed the FTA as great news for the industry and the region.

“Removing any tariff is going to increase our competitive edge in the UK market,” GisVin head winemaker Mark Thompson said.

The Gisborne region already exported “millions of litres” of wine to the UK.

“The benefits are more for our customers in England, who will be paying lower prices and will benefit from a reduced cost for the product.”

That would feed back into more brand loyalty, he said.

“The agreement is very positive for the New Zealand wine industry,” New Zealand Winegrowers chief executive Philip Gregan said. “We understand the agreement will mean significant progress for wine, including a specific wine annex. This will help remove technical barriers to trade and minimise burdens from certification and labelling requirements.

“The agreement will reduce trade barriers and remove tariffs on New Zealand wine exports to the UK, which will make a big difference for many within our industry.”

The deal was agreed in a video call last night between UK Prime Minister Boris Johnson and New Zealand Prime Minister Jacinda Ardern after 16 months of talks by Department of International Trade negotiators.

An Indevin spokeswoman said the free trade deal was “very positive” for the wine industry.

“Depending on our commercial arrangements with our customers, the removal of tariffs will have a variety of different impacts . . . (and) we will work hard to make sure that any extra value is shared with our partners in the industry.”

Tariffs will be eliminated after 15 years for sheep meat (export value $366.1 million) and beef ($4m), with significant quotas that will operate and provide duty-free access through a tariff rate quota (TRQ) regime for significant volumes of trade until all tariffs have been eliminated.

NZ Beef and Lamb expect the TRQ regime to save New Zealand farmers around $44m a year in tariffs each year from year one.

Federated Farmers Federated Farmers National President Andrew Hoggard said the announcement was great news for consumers and farmers in both countries.

“The United Kingdom is walking the talk when it comes to promising a truly global Britain,” he said.

Tariffs as high as 10 percent will be removed on a large range of UK goods — from clothing and footwear to buses, ships, bulldozers and excavators — giving British exporters an advantage over international rivals in the New Zealand import market, which is expected to grow by around 30 percent by 2030.

High-quality New Zealand products loved by British consumers — from sauvignon blanc wine to manuka honey and kiwifruit — will be cheaper to buy.

The agreement also recognises the unique and historical relationship that exists between Māori and the British Crown in regards to the Treaty of Waitangi.

Māori economic and trade interests have been prioritised in negotiations and are reflected across the agreement.

This includes a dedicated chapter that will create a future platform for co-operation on a range of issues important to Māori.

“This free trade agreement marks an exciting new chapter in the UK-New Zealand relationship, further strengthening our people-to-people and business links,” British High Commissioner to New Zealand Laura Clarke said.

“It reflects our unique and historic relationship and our shared values and aspirations for the future.

“This Free Trade Agreement will benefit both countries by removing tariffs on goods, enabling greater investment and business mobility, supporting the green recovery and enhancing Māori trade and investment links with the UK.

“When I was in Gisborne in 2019 I committed to a forward-looking relationship with Māori, and this is the next step in that journey.

“We've worked closely with a range of iwi and stakeholders on bilateral trade issues (including the first Te Taumata hui in Gisborne in July 2020), and are delighted with the inclusion of a dedicated indigenous trade chapter in this FTA that strengthens the UK's relationship with bicultural Aotearoa for the future.”