New Zealand concluded negotiations on a trade agreement with the United Arab Emirates late on Wednesday night, following a face-to-face meeting between the countries’ trade ministers.
Trade Minister Todd McClay and his counterpart from the UAE, Thani bin Ahmed Al Zeyoudi, announced the deal in Wellington on Thursday morning.
McClay said there had been a number of small outstanding issues that required ministerial sign-off, but the two leaders were able to work through them quickly on Wednesday.
“The reason for that is not only has a friendship grown, but actually the agreement is in the best interest of the people of both countries,” he told reporters.
Negotiations only began roughly four months ago, making this New Zealand’s fastest-ever trade deal. A press statement from McClay’s office said it was also the most liberal of all the UAE’s recent bilateral agreements.
Reuters has reported the UAE has been aggressively pursuing solo trade deals as an alternative to slower-moving negotiations as part of the Gulf Cooperation Council.
New Zealand has also been negotiating a trade deal with the GCC, an economic union of six Arab states on the Persian Gulf, but progress has been slower.
Zeyoudi said striking a direct deal between NZ and the UAE would inhibit the signing of a broader deal with the negotiating bloc and may actually hasten the process.
“We work on both tracks, and concluding a bilateral usually speeds up the GCC track. So, I'm sure this is going to move the GCC track, and both are going to complement each other.”
The agreement between NZ and UAE will eliminate duties and taxes on 98.5% of exports as soon as the deal enters into force. Two-way trade between the countries was valued at $1.3 billion in June 2024, with Kiwi exports making up the lion's share of that trade.
NZ exported $718 million of dairy products, $237 million of industrial products, and another $121 million of red meat, horticulture, and tourism services.
Meanwhile, it imported just $152 million of products from the UAE, including plastics, carpets, travel services and glass.
Federated Farmers welcomed the news as an “exciting and positive step forward” for farmers who had been struggling with squeezed profit margins.
"Farmers will gladly welcome any moves to reduce our costs, grow our incomes, or increase our competitiveness in the global marketplace,” it said in a statement.
"This agreement will take millions of dollars that would have been charged in tariffs and pump them directly into our rural communities.”
But not everyone will necessarily be happy with the deal. The Australian Council of Trade Unions opposed a similar agreement this month due to its lack of enforceable labour rights.
It expressed concerns that the UAE relied on migrant labour which has been described as a form of modern slavery.
McClay said there were a number of standard clauses New Zealand included in trade negotiations that handle all of those issues, which were also in this UAE deal.
Zeyoudi said labour had been considered through negotiations and the UAE had been transparent in their responses to requests for details from the Kiwi side.
However, he also said the focus of the deal was not on “blue collar or low skill level” workers because the main intention was to improve productivity and advance technologies.
In a separate statement, the Ministry of Foreign Affairs and Trade said there was a chapter in the agreement which “promotes the interests of women and protects labour rights and climate change laws and regulations”.
Now that negotiations have concluded, the proposed trade deal will go to Parliament for approval where it will go through a select committee process and take public submissions.
New Zealand still has trade negotiations underway with the GCC, Indo-Pacific nations, a grouping of Pacific and Latin American countries, and hopes to restart talks with India.
The previous Government completed deals with the European Union, the United Kingdom, and a grouping of Asia-Pacific countries called RCEP.
Damien O’Connor, the Labour Party’s trade spokesperson, welcomed the deal as being the “next step” after the progress made during his stint as Trade Minister, prior to the 2023 election.
“The UAE is a significant trading partner for New Zealand, with exports approaching $1 billion per annum,” he said.
“The UAE is also a hub for New Zealand Inc operations into the region and a key component of New Zealand’s air connectivity to the Middle East and beyond."
13 Comments
Fonterra is already reasonably well established in the UAE. This is an interesting overview.
https://www.mordorintelligence.com/industry-reports/united-arab-emirate…
You have to give people what they want. Not what we think is good and better.
Yogurt and Labneh: Staples in Arab diets, often enjoyed at breakfast or as accompaniments to meals. Labneh, a strained yogurt, is particularly popular as a spread or dip.
Cheeses: Feta and goat cheese are commonly used in salads and dishes. Cheese is also integrated into various traditional recipes.
Fermented Dairy: Many dairy products are consumed in fermented forms, which can be easier to digest for those with lactose intolerance.
It expressed concerns that the UAE relied on migrant labour which has been described as a form of modern slavery
Pointing out the irony in these concerns coming from a country sometimes known as the "Dubai of the South Pacific".
A place where the investment in businesses and new infrastructure is shunned because it’s simpler and easier to import cheap workers and bank the tax-free gains on leveraged property when not enough new houses are built to cope with the population growth
This was in an op-ed on the exploitation of labour in NZ? Or was it UAE?
As a trading nation we need many more of these type of deals, especially to those countries that need to bring in their food products. Looking at our negative trade balances with our traditional trading partners, we need to sell much more to a far wider audience, & at a premium if at all possible. We are very good at buying high-end imports, mostly as a want rather than a need, but not so good at selling our stuff to those nations who would love our foodstuffs, if we could just get off our fat backsides, & go out searching the planet for new customers & clients. It's not rocket science.
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