New Zealand's new trade deal eliminates tariffs on wool

04 Jul '24

2 min read

New Zealand's new trade deal eliminates tariffs on wool

Pic: Adobe Stock

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New Zealand has concluded a trade deal with Costa Rica, Iceland, and Switzerland, eliminating tariffs on hundreds of products, including wool.
The Agreement on Climate Change, Trade and Sustainability enhances commercial opportunities, supports renewable energy, and sets ecolabelling guidelines.
It aims to boost exports and address climate challenges.

In a move to advance trade while prioritising sustainability, New Zealand has concluded a landmark trade agreement with Costa Rica, Iceland, and Switzerland, eliminating tariffs on hundreds of products, including wool, that benefit the environment. The Agreement on Climate Change, Trade and Sustainability (ACCTS) is set to significantly enhance commercial opportunities for New Zealand businesses, according to trade and agriculture minister Todd McClay.

This ambitious agreement, a first of its kind outside of the World Trade Organization (WTO) framework, opens up significant commercial opportunities for New Zealand businesses. The focus on trade in sustainable goods and services is expected to drive growth and innovation in key sectors. Importantly for New Zealand, the agreement will see the removal of tariffs on crucial exports, including wool, thereby providing a significant boost to the country’s agricultural sector, the New Zealand government said in a press release.

The ACCTS will also eliminate tariffs on a wide range of other products, such as wool fibre and slag wool used for insulation. These measures are anticipated to enhance the competitiveness of New Zealand’s exports in the global market, fostering economic growth and job creation.

Beyond tariff elimination, the ACCTS agreement establishes rules to prevent harmful fossil fuel subsidies, thereby supporting the country's renewable energy sector. Moreover, the agreement sets forth guidelines for ecolabelling.

Minister McClay highlighted the strategic importance of the ACCTS, noting that it will open new markets for New Zealand exporters and generate increasing benefits over time as more countries join the agreement. This innovative trade deal not only provides new, high-quality trade opportunities but also addresses pressing climate and sustainability challenges.

“It is only through a strong economy that we can lift incomes, reduce the cost of living and provide Kiwis the public services they deserve. The ACCTS deal helps to achieve this," said McClay.

Fibre2Fashion News Desk (DP)