New Zealand Prime Minister Jacinda Ardern and European Commission President Ursula von der Leyen after their June 30 meeting. Getty ImagesIt is easy to understand New Zealand's motivation to enter into a Free Trade Agreement (FTA) with th"> New Zealand Prime Minister Jacinda Ardern and European Commission President Ursula von der Leyen after their June 30 meeting. Getty ImagesIt is easy to understand New Zealand's motivation to enter into a Free Trade Agreement (FTA) with th">

A trade deal with the EU makes sense for New Zealand, but what about Europe? Symbolically, many

<classe étendue="légende">New Zealand Prime Minister Jacinda Ardern and European Commission President Ursula von der Leyen after their June 30 meeting.</span> <span class="attribution"><span class="la source">Getty Images</span></span>”  data-src=”https://s.yimg.com/ny/api/res/1.2/MRg7Uyx6aVB090An0GWC1A–/YXBwaWQ9aGlnaGxhbmRlcjt3PTk2MDtoPTY0Mw–/https://s.yimg.com/uu/api/res/1.2/_6vTrAMnC4rdpE_1zOKx8w- -~B/aD05NjQ7dz0xNDQwO2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/the_conversation_au_articles_517/936e1c889293c5b112d87bba3ff3ef48″ data-src=”https://s.yimg.com/ny/api/res/1.2/MRg7Uyx6aVB090An0GWC1A–/YXBwaWQ9aGlnaGxhbmRlcjt3PTk2MDtoPTY0Mw –/https://s.yimg.com/uu/api/res/1.2/_6vTrAMnC4rdpE_1zOKx8w–~B/aD05NjQ7dz0xNDQwO2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/the_conversation_au_articles_517/936e1c889293c7b134″ef8bba>d384″ef8bba></div>
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<p><figcaption class=New Zealand Prime Minister Jacinda Ardern and European Commission President Ursula von der Leyen after their June 30 meeting. Getty Images

It is easy to understand New Zealand’s motivation to enter into a Free Trade Agreement (FTA) with the European Union (EU). What is less clear is why the EU chose to pursue the deal with a small, faraway country, currently ranked as the 50th largest trading partner.

In contrast, the EU is New Zealand’s fourth largest trading partner (after China, Australia and the United States). And although the deal has been criticized by some in the dairy and meat industries, it is still expected to bring an additional NZ$1.8 billion a year to the New Zealand economy. by 2035.

But the trade deal, announced at the end of June during Prime Minister Jacinda Ardern’s European visit (during which she also attended a NATO summit), was hard won.

He has gone through 12 rounds of negotiations facing various challenges and distractions for the EU: Brexit, EU opposition to New Zealand agricultural exports, the global pandemic and the war in Ukraine. All of this suggests that more than just economic motivations were at play for the 27 EU member states.

Digging deeper, then, we can see several important strategic considerations for the European Union that illustrate some of its current thinking, not only about the direction of its global trade policy, but also about its international ambitions.

EU back on track

Negotiations between the EU and New Zealand were officially launched in 2018 (alongside an EU-Australia FTA which has yet to be concluded). At the time, New Zealand was one of the few countries that had neither concluded nor negotiated preferential trade relations with the EU.

The EU has accelerated New Zealand and Australian negotiations to counter the perceived trade protectionism represented by Brexit and the Trump presidency in the United States.

Read more: Some see New Zealand’s invitation to the NATO summit as a reward for a change in foreign policy, but that’s far from accurate

With a population of five million and a GDP of just US$250 billion, New Zealand does not represent much financially to the EU. Symbolically, however, it has a broader meaning.

The deal was described as a “welcome and much-needed resumption of an ambitious EU trade agenda”. This had been hampered by member states’ resistance to ratifying the FTA with the South American regional trading bloc Mercosur, increased protectionism due to the pandemic and EU trade sanctions against Russia.

Climate change and security

The EU also hailed the deal as containing “the most ambitious sustainability commitments ever made in a trade deal”. The inclusion of mutually binding commitments in the Paris Agreement is part of reinforcing the EU’s claim to be a global leader in climate change policy.

The EU already has some of the strongest climate policies in the world, with around 87% of its citizens agreeing that “the EU should set ambitious targets to increase renewable energy and support energy efficiency”.

Read more: Behind the “inclusive” facade, the New Zealand-UK free trade agreement disappoints politically and economically

Although the EU was a dominant voice in the Paris Agreement, it is more difficult to persuade non-member countries to follow its own high environmental standards. This FTA will set a new standard, not only for the EU but also for the world.

A voice in the Indo-Pacific

Perhaps more importantly, however, closer cooperation with New Zealand can strengthen the EU’s place in the increasingly strained Indo-Pacific, a region where it has already named New Zealand as one of its partners.

EU and New Zealand officials often highlight their shared values ​​of democracy, human rights and the rule of law. And the EU is an important stabilizer in the rules-based international system that remains so important to small states like New Zealand.

The EU’s cooperation with like-minded Pacific countries is a key factor in its quest for recognition and legitimacy in a region of increasing geostrategic importance.

Read more: German elections: The race to replace Angela Merkel and why it matters for New Zealand

The EU launched its Indo-Pacific strategy in 2021, like Australia (2016) and the United States (2017), and New Zealand’s Pacific Reset (2018).

And although New Zealand is a small country, it enjoys a largely positive international image thanks to its independent foreign policy and is an important regional player. It is a member of the Pacific Islands Forum and was the first country in the world to sign an FTA with China.

Benefits beyond trade

The establishment of the AUKUS pact in 2021 has further increased New Zealand’s importance as an EU Indo-Pacific partner, involving Australia’s withdrawal from a contract to purchase French submarines .

This agreement had been considered by France as the cornerstone of its own approach to the region. Its collapse has somewhat soured Australia’s relationship with one of the key players in the EU.

For all these reasons, the EU-NZ FTA can therefore be seen as a positive development that cements an economic relationship while emphasizing common values, goals and benefits beyond purely monetary gains.

Although potentially economically advantageous for New Zealand – and not without its detractors – it can be understood as a signal of the EU’s intention to extend its global influence beyond trade, claiming a claim as a political and security actor of real importance.

This article is republished from The Conversation, the world’s leading publisher of research-based news and analysis. A unique collaboration between academics and journalists. It was written by: Serena Kelly, University of Canterbury and Mathew Doidge, University of Canterbury.

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Serena Kelly receives funding from the Erasmus+ program of the European Union. It is affiliated with the New Zealand Institute of International Affairs and the European Studies Association of Australia and New Zealand.

Mathew Doidge receives funding from the Erasmus+ program of the European Union. It is affiliated with the European Studies Association of Australia and New Zealand (ESAANZ).

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