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Don’t copy the Kiwis: Australia urged to quit EU trade talks if offered New Zealand’s deal

The Sydney Morning Herald | 10 July 2023

Don’t copy the Kiwis: Australia urged to quit EU trade talks if offered New Zealand’s deal

By Latika Bourke

Brussels: Australian farmers are urging Trade Minister Don Farrell to walk away from negotiations with the EU if the bloc offers a deal akin to the one signed with New Zealand in Brussels overnight.

New Zealand Prime Minister Chris Hipkins inked the agreement in a ceremony alongside European Commission President Ursula von der Leyen on Sunday (local time).

New Zealand says the deal will eventually allow its producers tariff-free access for 97 per cent of goods.

But the EU retained the use of quotas for some Kiwi dairy products, beef and sheep meat, ethanol and sweetcorn.

It said that New Zealand would not be allowed to export more than 10,000 tonnes or 0.15 per cent of the amount of beef the EU consumes tariff-free.

The EU said that – for butter, cheeses and milk powder – New Zealand could only export 0.71 per cent, 0.27 per cent and 1.3 per cent of the EU’s total consumption respectively before tariffs kicked in, to make them more expensive against EU-produced goods.

Asked what Australia should do if presented with similar limited access to the single market, which has about 446 million consumers, Tony Mahar, chief executive of the National Farmers Federation, was blunt.

“We’d say walk away, thanks but no thanks,” he said in an interview. “If it doesn’t mean commercial dollars then we’re not interested.”

Farrell has broken his European holiday to resume trade negotiations, which began about the same time as New Zealand’s and have reached their most tense stage, after the EU refused to grant Australia commercially meaningful market access to its sheepmeat, beef, dairy and sugar markets.

Farrell will meet Mahar on Monday morning before the resumption of talks.

“I’m here to back the trade minister to make sure he gets a commercially meaningful deal for Australian farmers – one that’s well over and above what the EU has agreed to with New Zealand,” Mahar said.

At the signing ceremony, von der Leyen hailed the deal as “trailblazing” because it included commitments to the Paris climate agreement. Two separate agreements also grant New Zealand access to the EU’s science and research program Horizon as well as the international crime-fighting organisation Europol.

The president said the deal would boost trade with New Zealand by as much as 30 per cent and the value of EU exports to New Zealand by as much as €4.5 billion ($7.4 billion).

New Zealand said its exports could grow by as much as $1.8 billion a year with duties removed on 97 per cent of Kiwi goods after seven years. The deal is expected to come into force in the first half of next year.

Hipkins said: “New Zealand exporters will get better access to the European Union than they have ever had before.”

But Sirma Karapeeva, chief executive of New Zealand’s Meat Industry Association has previously said the government had agreed to small quotas that would constrain the ability of New Zealand’s agricultural companies to export to the EU.

“This agreement is not consistent with our expectations and the promise for an ambitious, high quality trade deal,” she said.

Speaking before the signing ceremony, which he also attended, New Zealand Trade Minister Damien O’Connor was forced to defend the quality of the deal and suggested that the country’s small size meant it had less bargaining power than Australia.

“We went right to the wire, pushing them as far as we could,” O’Connor told 1News.

“We are a market of 5 million people. Australia is considerably larger.

“And so every country will negotiate with the coin that it has, and we do not have a lot, but we got a pretty good deal.”

The EU’s statement praised New Zealand for protecting more than 2000 EU agri-food names, known as Geographical Indications. Examples include champagne, feta and prosecco.

“This matters because we share a common understanding that Geographical Indications are rural intellectual property, and therefore important drivers of rural prosperity and job creation,” the EU said in its statement.

Geographical Indications have been one of the major hurdles blocking progress on an Australia-EU trade deal. Australia has insisted that the country’s postwar migrants deserve to have their local produce recognised in the same way the EU treats produce made by their ancestors.

Opposition trade spokesman Kevin Hogan said Geographical Indications must be a red line.

“There must be no compromise on the EU’s demands on Geographical Indications,” Hogan said.

“It must not include a long list of EU ‘conditions’ on Australian exports such as restricting beef exports to grass-fed beef only.

“Simply put, unless the EU makes a vastly improved offer from its previously only-weeks-old attempt, it is not a trade deal worth doing.”

 source: The Sydney Morning Herald