British businesses and consumers will soon be able to reap the benefits of the UK’s first trade deals negotiated from scratch since leaving the European Union with the agreements set to come into force this month. Expected to increase bilateral trade with Australia by 53% and with New Zealand by 59% in the long term, the two game-changing free trade agreements are anticipated to go live across all three countries from midnight on 31 May. Both trade deals will drive economic growth and innovation across the UK, Australia and New Zealand through the removal of tariffs on all UK goods exports, open unprecedented access for services, cutting of red tape for digital trade, and by making it easier for UK professionals to live and work in Australia and New Zealand. It comes just weeks after the UK concluded negotiations to join the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), a free trade area worth £9 trillion, putting us at the heart of a trading powerhouse. Business and Trade Secretary, Kemi Badenoch, said: “With these two deals the UK is using our status as an independent trading nation to tailor agreements to our country’s economic strengths. Alongside our recent conclusion of talks to join CPTPP, the government is forging a bold new future alongside the world’s most dynamic and fast-growing economies. “Putting these trade deals into action will help create new opportunities for business, boosting wages and helping spur economic growth.” Head of Trade Policy at the BCC, William Bain said: “It is good news to hear that the free trade agreements with Australia and New Zealand will finally come into force at the end of the month. “These deals will lower tariffs, simplify customs procedures, allow for greater freedom of movement for labour and provide stronger market access for the UK’s world-leading services sector. “But the success of any free trade agreement comes down to whether businesses use it, so it’s vital the Government shouts from the rooftops about these new opportunities. “A recent BCC survey also found almost a quarter of firms (23%) said finding a business partner or distributor overseas would encourage them to either start exporting or export more. “We have strong Chambers in both Australia and New Zealand and will be working with them to get the most out of these trade deals for all our economies.” Services are central to the UK’s economy, accounting for around 80% of its economic output and workforce, and one of its biggest export success stories. The provisions in these deals complement our strengths and will help deliver on the PM’s priority of growing our economy. UK professionals from scientists and researchers to lawyers and accountants will have access to Australian work visas without being subject to its changing skilled occupation list. Brits will also be able to work more freely in New Zealand through commitments which enable UK service suppliers to deliver contracts. Other UK benefits include:
- Investment opportunities and access to government contracts, including putting British businesses on equal footing to compete for an additional £10 billion of Australian public sector contracts per year and high investment screening thresholds for UK investors in New Zealand
- Tariff free access to both markets for all British goods and flexible rules of origins, giving businesses a competitive edge over international rivals
- Reaffirmed commitments to the Paris Agreement and opportunities to grow our low-carbon economy, with tariffs on environmental goods liberalised
- Removal of UK import tariffs on majority of goods from Australia and New Zealand, reducing prices for UK consumers on favourites such as wine and manuka honey and lowering costs on machinery parts for UK manufacturers
- Progressive rules on digital trade and free flow of data, cutting red tape for SMEs and easing trade while protecting intellectual property, brands and innovations
There are robust protections for British farmers in both deals, including staging tariff liberalisation for sensitive goods over time. Both countries are key members of the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), a huge trade bloc in the Indo-Pacific. The agreement is expected to enter into force on the 31 May, subject to finalisation of UK domestic procedures with remaining changes to UK law coming into force at the end of May. More information on the UK-Australia free trade deal can be found on GOV.UK and the GREAT website. More information on the UK-New Zealand free trade deal can be found on GOV.UK and the GREAT website.
