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UK-New Zealand trade deal a ‘great step forward’ for SMEs

The newly-signed free trade deal between the UK and New Zealand, the UK’s latest in the targeted Asia-Pacific region, is expected to offer significant benefits for smaller exporters.

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The newly-signed free trade deal between the UK and New Zealand, the UK’s latest in the targeted Asia-Pacific region, is expected to offer significant benefits for smaller exporters.

The free trade deal signed on 28 February will remove trade barriers on a wide range of UK goods and services. This includes the elimination of tariffs for goods in areas such as clothing and footwear, food and drink, furniture, machinery and chemicals.

The agreement is described as the most advanced New Zealand has signed with any nation bar Australia, and is part of the UK government’s wider plan to refocus trade on the Asia-Pacific region. It is also being hailed as one of the UK’s ‘greenest’ trade deals to-date, with low carbon services and technology subject to significant benefits.

According to the government, SMEs will now find it easier to break into the New Zealand market as a result of “modernised customs procedures” such as digital documents and rapid customs clearance. A chapter devoted to SMEs in the agreement also sets a guarantee for small businesses to benefit from “practical advice and support” to find opportunities in New Zealand, including dedicated websites for small exporters.

In addition, flexible rules of origin mean that most UK manufacturers will be able to qualify for tariff-free trade whilst maintaining their existing supply chains.

Mike Cherry, National Chair of the Federation of Small Businesses (FSB), said:

“New Zealand is a key market for UK small businesses – close to a third of smaller exporters already have ties to the nation. As such, this deal marks a great step forward, and we are pleased to see inclusion of a dedicated SME chapter that will help more small businesses from both countries to take part in international trade and, in doing so, spur our global economic recovery.

“We also welcome the important additional measures outlined as part of the agreement, not least around the streamlining of self-declaration of origin procedures and bringing more small businesses into government supply chains.”

Around 5,900 UK SMEs currently export to New Zealand and manufacturing sector exports totalled £670 million in 2020. Recent research by Santander found that almost a quarter of British exporters forecast significant growth opportunities in Australia and New Zealand.

 

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