In an exciting development for UK businesses, the UK’s trade deals with Australia and New Zealand have officially come into force today, 31 May, marking the first negotiated trade agreements since the UK’s departure from the EU.
These deals bring significant benefits for UK exporters. Tariffs on all UK goods exports to Australia and New Zealand will be eliminated, providing unprecedented access to these markets for services. Moreover, there will be a significant reduction in red tape for digital trade and work visas.
The positive impact of these agreements will be felt across all regions and nations of the UK. Customised to leverage the UK’s strengths, the deals are projected to boost the economy by driving bilateral trade up by 53% with Australia and 59% with New Zealand.
Notably, these agreements will also translate into tangible benefits for UK consumers. Reduced prices can be expected on popular products such as wine, Tim Tams, and kiwi fruit, while UK manufacturers will enjoy lowered costs on machinery parts.
This announcement follows the successful completion of the domestic ratification processes by the UK, Australia, and New Zealand. The UK’s Trade (Australia and New Zealand) Bill played a crucial role in enabling the deals to take effect.
Business and Trade Secretary Kemi Badenoch said, “Today is a historic moment as our first trade deals to be negotiated post-Brexit come into effect. Businesses up and down the country will now be able to reap the rewards of our status as an independent trading nation and seize new opportunities, driving economic growth, innovation and higher wages.”
In light of this milestone, International Trade Minister Nigel Huddleston will visit DHL’s Southern Distribution Centre near Heathrow to oversee the departure of two specially selected shipments of UK goods. These consignments will be among the first to be sent to Australia and New Zealand under the new agreements.
The parcels will feature a range of iconic British goods from across the country, including signed Beano comics, Penderyn Single Malt Welsh Whisky, Brighton Gin, The Cambridge Satchel Co. bags, and Fever-Tree mixers. Many of these items will benefit from the removal of tariffs under the trade deals.
The shipments will also include unique items such as an England cricket top signed by James Anderson and Emma Lamb, a Wales rugby shirt signed by the men’s team, and a real tennis racket from Gray’s of Cambridge. In addition to the new trade agreement with Australia, more young British individuals will have opportunities Down Under, thanks to the expansion of the shared Youth Mobility and Working Holiday Maker visa schemes.
Starting from 1 July, 2023, the age limit for UK applicants going to Australia will increase from 30 to 35 years old. Furthermore, from July 1, 2024, Brits will be able to stay in Australia for up to three years without having to meet specific work requirements.
The consignments will be swiftly transported via express air freight provided by DHL, which is actively working towards achieving zero emissions logistics globally by 2050. DHL handles over 100,000 shipments per day for UK businesses, and the markets of Australia, New Zealand, and other CPTPP countries are highly popular, with expectations of continued growth.
CEO of DHL Express UK Ian Wilson said, “The new free trade agreements with Australia and New Zealand provide businesses with a great opportunity to capitalise on the demand in these markets for British goods. Through our recent collaboration with the Department for Business and Trade, we have been able to explain the new deals through webinars and simplified guides which we hope will help our customers achieve even greater international growth.”
Both free trade agreements also align with the UK’s strategic focus on the Indo-Pacific region and complement its forthcoming accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a massive trade bloc with a combined GDP of £12 trillion.
These trade deals include robust protections for British farmers, incorporating gradual tariff liberalisation for sensitive goods over time.
Key benefits of the agreements include:
- Access to Australian work visas for UK service suppliers, independent of changes to Australia’s skilled occupation list, and increased work opportunities for Brits in New Zealand.
- Flexible rules of origin and the elimination of tariffs on all UK exports to both markets.
- Advanced rules on digital trade, streamlining bureaucratic processes, facilitating the free flow of data, and ensuring the protection of valuable intellectual property for businesses.
- Access to government contracts and investment opportunities, including equal opportunities to compete for an additional £10 billion
Founder and Managing Director of Brighton Gin Kathy Caton said, “In an increasingly competitive and global market removing trade barriers is exactly the support that the British gin industry needs. With a Brighton in every state in Australia, one of our goals is to see Brighton Gin being served in every one! Hopefully the free trade agreement gets us one step closer to that.”
CEO of Frugalpac Malcolm Waugh said, “Frugalpac produces the world’s first paper bottle for wines and spirits and the machines that make them. Our Frugal Bottles, which are made from 94% recycled paperboard and have a carbon footprint six times lower than a glass bottle, are now sold in 22 countries, including Australia and New Zealand.”