New Zealand’s Trade Pact With EU Drives 28% Surge in Goods Exports in First Year

New Zealand’s ambitious free trade agenda is already yielding strong dividends, with the country’s recently implemented Free Trade Agreement (FTA) with the European Union (EU) driving a sharp 28% increase in Kiwi goods exports to the region within its first year of operation.

According to Trade and Investment Minister Todd McClay, exports to the EU jumped from NZ$3.8 billion to more than NZ$4.8 billion in the 12 months since the agreement’s early entry into force—a NZ$1 billion increase that is already delivering real value to the economy and exporters alike.

Boost Across Key Sectors

Several of New Zealand’s cornerstone export industries have posted impressive growth figures, with agriculture and advanced manufacturing among the biggest winners.

• Sheep meat exports rose 29%, injecting an additional NZ$216 million into the economy.

• Kiwifruit exports soared 69%, bringing in an extra NZ$316 million compared to the previous year.

• Machinery exports more than doubled, increasing by a remarkable 104%, which added NZ$173 million in additional export value.

“This is good news for all New Zealanders, especially our sheep farmers, kiwifruit growers and machinery exporters,” Minister McClay noted. “It shows that the Government’s commitment to opening new markets is working to grow the economy and drive up incomes.”

Long-Term Tariff Elimination to Fuel More Growth

Under the terms of the NZ-EU FTA, 91% of duties on New Zealand goods were scrapped immediately upon the agreement entering into force. This figure is set to rise to 97% over a seven-year implementation timeline, unlocking even greater potential in the years ahead.

Products such as wine, seafood, and other high-value food and beverage items are also set to benefit from deep tariff cuts. The result is a more competitive pricing environment for New Zealand exporters in one of the world’s wealthiest and most sophisticated consumer markets.

This rapid liberalisation of trade terms is expected to enhance the global competitiveness of New Zealand’s exports, especially in areas where EU demand is rising for sustainably produced and high-quality food products.

A Cornerstone for Export-Led Growth

The NZ-EU agreement is a critical part of the New Zealand Government’s broader plan to double the value of the country’s exports within the next decade. In addition to tariff reductions, the FTA includes provisions that streamline customs procedures, strengthen rules of origin, and enhance protections for intellectual property and geographic indications.

“Our growing network of trade agreements means exporters now have more choices about where to sell their world-class products,” McClay said. “Strengthening ties with our global trading partners is essential to unlocking opportunities and expanding our economic resilience.”

The European Union is New Zealand’s fourth-largest trading partner, and the new FTA is expected to solidify and grow that relationship substantially. With smoother trade flows, lower costs, and reduced bureaucratic friction, the agreement sets a new benchmark for what can be achieved through comprehensive and modern trade deals.

Broader Strategic Implications

The early success of the NZ-EU FTA also reinforces the country’s position as a leader in rules-based global trade. It comes at a time when New Zealand is actively engaged in securing or updating several other key agreements, including negotiations with the United Kingdom, India, and members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

For small and medium-sized enterprises (SMEs) as well as major exporters, the benefits of trade liberalisation are becoming increasingly evident. In rural communities and regional hubs, where export industries are often the backbone of the local economy, these gains are particularly significant.

As New Zealand continues to invest in its global trade relationships, the momentum generated by the NZ-EU FTA offers a compelling case study in how well-designed trade agreements can create tangible outcomes for producers, workers, and consumers across the board.