EU agrees to advance FTA talks with New Zealand

Prime Minister John Key has won agreement with European Union leaders to embark on the next steps to a comprehensive TPP-style free trade agreement.

The EU is already New Zealand’s third largest export market and trading partner.

Mr Key signed the agreement with European Commission President Jean-Claude Juncker and European Council President Donald Tusk in Brussels overnight.  

It agreed to start further discussions that will focus on the next steps required to formally launch negotiations, including the scope and overall approach.

The ministerial talks also included the climate change summit in Paris next month, Syria and the refugee crisis as well as agreements on customs and animal health issues, according to the communiqué. 

“I am pleased that we are able to announce a critical first step toward an FTA that should provide greater access to European markets, and make it easier for Kiwi and EU companies to do business with one another," Mr Key says.

The FTA announcement builds on the EU’s recently revised Trade Policy Strategy, which sets out an increased focus on the Asia-Pacific region.

Trade Minister Tim Groser, who separately met  EU Trade Commissioner Cecilia Malmström, says such a deal with a mature economy of $20 trillion offers the opportunity to tap into the innovation, skills and capital to further develop New Zealand.

“More and more we see New Zealand and European exporters cooperating in order to supply growing world food demand,” he says.

“We look forward to updating the framework for our trade and economic relationship to reflect this, supporting the overall strengthening of our ties with our key historical and contemporary partners in the EU.”

In a statement, both sides agreed that the future deal should comprehensively address all of the issues concerning the current trade and investment relation.

"The shared aim is to create rules that correspond to the reality of global supply chains and the increasing international interdependence in manufacturing and provision of services. The future agreement would also promote transparency of rules, the fight against corruption and coherence between economic benefits, workers' rights and environmental protection."

Mr Groser says both sides also have internal processes, including Cabinet approval, to complete in order to obtain the more detailed mandates needed to begin the FTA negotiations, which will also include a similar FTA with Australia and probably take about two years to complete.

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