European Union 'giving birth' to free trade negotiations with New Zealand

Dr Malmstrom and Mr Parker.
Dr Malmstrom and Mr Parker. Photo credit: Newshub

The Government has launched negotiations for a Free Trade Agreement between New Zealand the the European Union (EU).

EU Trade Commissioner Dr Cecilia Malmstrom, described as the second most powerful woman in Europe, met with Trade Minister David Parker in Parliament on Thursday.

She wished Prime Minister Jacinda Ardern well on the birth of her child, and said: "we are also giving birth to something today, which is the launch of our Fair Trade Agreement, a very special opportunity".

Dr Malmstrom said today is an important milestone in EU-New Zealand relations.

"This agreement is an excellent opportunity to set ambitious common rules and shape globalisation, making trade easier while safeguarding sustainable development. We can lead by example."

But she acknowledged that agriculture is likely to be the biggest sticking point for any agreement.

"In all negotiations that I have been involved with during my time as Trade Commissioner, and there's quite a few, agriculture has always been the difficult thing in the very end."

"Yes there will be sensitivities on both sides, and a few other issues, but we are well aware of them.  There is no hidden agenda here, we are very open about our sensitivities and we try to find a good compromise," she said.

Dr Malmstrom, a Swedish former academic, has served as Trade Commissioner since 2015. She represents the 28 member states of the European Union.

"We are standing up for rule-based world trade, based on openness and fairness," she said.

The EU is working simultaneously on a Free Trade Agreement with Australia, which launched earlier this week.

Dr Malmstrom with Acting Prime Minister and Foreign Minister Winston Peters.
Dr Malmstrom with Acting Prime Minister and Foreign Minister Winston Peters. Photo credit: Newshub

European Commission president Jean-Claude Juncker said the talks follow successful agreements with Canada, Japan and other countries "committed to open and rules-based global trade".

The EU is New Zealand's third biggest trading partner, and last year the two-way trade in goods was worth $14.5bn and $7.4bn was exchanged in services.

The EU exports manufactured goods to New Zealand like transport equipment, machinery, appliances, chemicals, plastics and food.

The European Union says the agreement could increase overall trade in goods by almost 50 percent.

Mr Parker said there aren't many countries in the world that stand up for human rights, nuclear weapons controls, respect for minorities, support good labour laws, that hold up wages so we have high wage economy, invest in technology and believe strongly in solving environmental problems.

"But the countries that walk-the-talk includes the countries of Europe and New Zealand," he said.

The first formal round of negotiations is set to take place in Brussels next month.

While in New Zealand, Dr Malmstrom will also meet with Acting Prime Minister and Minister of Foreign Affairs Winston Peters and will meet the Foreign Affairs, Defence and Trade select committee.

Asked whether she had any advice for the Prime Minister, who is currently in labour, Dr Malmstrom said: "I don't think it's my role to give her advice, I think she's doing formidably. It is not very often that we see sitting Prime Ministers also having babies but I think that is part of the modern world."