The UK is poised to try and create a new free trade agreement with both Australia and New Zealand. The first round of negotiations will take place rem
The UK is poised to try and create a new free trade agreement with both Australia and New Zealand. The first round of negotiations will take place remotely on 29 June. It is hoped that common ground can be found to help the UK find new trade partners in light of the fallout from Brexit.
A new deal would aim to remove tariffs between the nations, and harmonise a range of regulation regarding customs and trade. The negotiations come at a key time when all three nations are looking to emerge from the devastating economic impacts of the coronavirus pandemic.
Areas of opportunity
The plans to bolster free trade between the UK and Australia and New Zealand would have massive impacts for a range of industries. Agriculture will be a particularly hot topic, although there would also be attention paid to everything from vehicle manufacturing to climate change agreements.
As a result, there will be several key areas to negotiate. New Zealand’s trade minister, David Parker, stated that there would be a particular focus on the ‘development of digital trade.’
The UK currently boasts a healthy digital economy with several areas such as iGaming having produced some of the leading brands in the world. Some proven brands like Bet365 have already had a significant impact in Australian markets, and the further deregulation of legislation between the nations could have a positive impact.
The fact that the UK has one of the most heavily regulated gambling markets in Europe means that things might not change too much for many British operators. But with licensing laws in Australia prohibiting online live sports betting and casino gaming, it means that inconsistencies like this might have to be ironed out through a new deal.
Above all, the deal will hopefully produce a shared infrastructure between the three nations that could reap mutual benefits. With Brexit continuing to affect the UK with uncertainty over mobile roaming and much more, it’s hoped that a new trade deal could provide a confidence boost for the nations’ economics.
Benefits of closer ties
Each participating nation would stand to benefit greatly from a new deal. Australia’s trade minister, Simon Birmingham, said that the country would be hoping to gain greater market access for agriculture, while also seeking to remove wine tariffs and agree new legislation for investment and digital trade.
New Zealand would be hoping to strengthen ties with the UK which is the nation’s sixth largest trading partner. A new deal would hopefully lessen tariffs for New Zealand goods like kiwi fruit and manuka honey that are as high as 8% and 16% respectively.
Similarly, the UK would be hoping that the UK’s tariffs of 10% on car parts and 5% on gin could be lessened. Although both Australia and New Zealand have been increasingly looking towards nations in the Far East for investment, the UK’s divorce from the EU could provide a new source of trade.
Factors holding up a new trade deal
While there are hopes that a new deal can be concluded by the end of 2020, such a timeframe is optimistic given the ongoing pandemic. In addition to this, there is little way that any deal can be agreed while the Brexit negotiations remain in deadlock.
The UK has already come up against significant issues in negotiations in regards to issues like fisheries, and current talks to open up new trade deals with the USA and Japan have also ran into problems.
The negotiations come at a time when Australia is already negotiating a new trade deal with the European Union. The EU is currently Australia’s third-largest trading partner, while the UK is just seventh-placed.