The European Parliament gave its approval to the free trade agreement between the European Union and New Zealand this week, marking a milestone that will remove tariffs on many New Zealand exports to the EU. The pact includes new sanctions tied to climate and labor commitments, signaling a tougher stance on compliance than prior trade deals.
In a decisive vote, the Parliament backed ratification by 524 in favour, 85 against, and 21 abstentions. MEPs hailed the agreement as a central element for the EU to strengthen its role and influence in the Indo-Pacific region, underscoring its strategic significance beyond traditional trade terms.
Once fully in force, all New Zealand tariffs on EU goods will be eliminated, with a glide path for remaining measures; within seven years, a large portion of tariffs are expected to be removed, subject to ongoing EU assessments. The decision on the EU–New Zealand trade relationship will be implemented through a staged schedule, as laid out in the agreement.
The pact safeguards geographical indications for European wines and spirits, protecting brands such as Rioja, Prosecco, and similar products. It also lists 163 famous foods and supports European producers of precision agriculture, including beef and dairy sectors, aiming to level the playing field on both sides of the partnership.
For the first time, binding commitments on climate action and labor standards are integrated into the agreement, with explicit sanctions for non-compliance. The mechanism draws on Paris Agreement principles and international labor standards backed by the International Labour Organization (ILO), reinforcing the trade framework with environmental and social norms. [citation]
Daniel Caspary, a member of the European Parliament from the European People’s Party and the rapporteur for the report, stated at a press briefing that the deal represents a modern model for future EU trade arrangements. He emphasized its potential to serve as a benchmark for other negotiations. [citation]
Caspary noted a dedicated one-stop shop for small and medium-sized enterprises, including a standalone digital trade chapter. This framework, backed by binding climate obligations and penalties, is designed to make compliance clear and enforceable for businesses of all sizes. [citation]
Trade in goods between the EU and New Zealand stood at about 9.1 billion euros, with the EU described as New Zealand’s third-largest trading partner. The European Commission views the agreement as a catalyst for deeper economic ties and broader market access. [citation]
Officials expect total trade between the EU and New Zealand to rise substantially, with investment flows increasing and the EU’s share of trade growing significantly. The accord is seen as a vehicle to expand opportunities for European companies, particularly SMEs, to compete on a level playing field with local players. [citation]
The message from policymakers is clear: European firms, especially smaller ones, should gain more routes to export, and the EU will be in a stronger position to shape the future of international trade. The negotiations and framework aims to balance market access with robust safeguards to ensure sustainable and fair practices. [citation]
Members of the European Parliament indicated that the deal would move forward after the approval of member states, with the expectation that New Zealand ratification would follow promptly. Once formal approval is granted on both sides, the agreement is slated to take effect in the near term, bringing concrete economic and regulatory changes for both continents. [citation]