New Zealand and the European Union have struck an historic free trade deal, “unlocking access to one of the world’s biggest and most lucrative markets” after four years of tough negotiating.

Prime Minister Jacinda Ardern and President of the European Union Ursula von der Leyen unveiled the details in Brussels, but it was touch and go as to whether a good enough deal could be agreed.

The negotiations went right to the limit, with Ardern and Trade Minister Damien O’Connor involved in the last phase of the talks, just hours before the official announcement was made.

• READ MORE: Other NZ trade with Europe reports

The agreement — about 14 years in the making — means New Zealand views it as “commercially meaningful” and as worth putting pen to paper.

Ardern said it was a “strategically important and economically beneficial deal that comes at a crucial time in our export led covid-19 recovery”, covering 27 EU member states.

“It delivers tangible gains for exporters into a restrictive agricultural market. It cuts costs and red tape for exporters and opens up new high value market opportunities and increases our economic resilience through diversifying the markets that we can more freely export into,” she said.

By 2035, the value of New Zealand exports to the EU will increase by $1.8 billion a year, which Ardern said was more lucrative than the benefits gained from New Zealand’s recent deal with the United Kingdom.

Eventually duty free
Eventually, 97 percent of New Zealand’s current exports to the EU will be duty-free, and more than 91 percent of tariffs will be removed the day the FTA comes into effect.

There will be immediate tariff elimination for all kiwifruit, wine, onions, apples, mānuka honey and manufactured goods, as well as almost all fish and seafood, and other horticultural products. It will also become easier for a range of service providers to access the EU, including education.

Meat and dairy have always been a tough sell due to the protected European market; once fully implemented this deal will deliver new quota opportunities worth over $600 million in annual export earnings, with an eight-fold increase to the amount of beef able to be sold into Europe. Duty free access for sheep meat has been expanded by 38,000 tonnes each year.

Red meat and dairy will get up to $120 million worth of new annual export revenue on day one of the deal, with estimates of more than $600 million within seven years.

Quotas have been established for butter, cheese, milk powders and protein whey.

The vast bulk of dairy tariffs will be eliminated within seven years, however the current system is a bit trickier. New Zealand had World Trade Organisation quotas for butter and cheese, but exporters couldn’t make use of them as the “in-tariff rates” were so high it was not economic to make use of them.

For example, butter has a 46,000 tonne annual quota, but the tariff rate was 38 percent.

Cheese break through
Under the new deal, of that quota, 36,000 tonnes will have a 5 percent tariff over seven years — once fully in force that is a $258 million benefit each year.

There has been a stop on New Zealand cheese exports to the EU for the last five years, for the same reason.

But under the FTA there will be immediate access through a tariff-free, annual quota of 31,000 tonnes — worth about $187 million each year to the local industry.

Another particular element of the deal is “geographical indications”; names of products that come with a strong connection to a specific area and ones the EU wants protected from use by anyone outside of that region.

For the cheese makers and the cheese lovers — New Zealand will be able to keep using the names gouda, mozzarella, haloumi, brie and camembert.

Feta, beloved to Greece, will be off the table though and producers here will have to find another name in nine years’ time.

Cheese makers will be able to keep using the name “gruyere”, as long as they had been doing so five years before the deal comes into effect; the same with “parmesan”.

Medicines carve out
There has been a carve out for New Zealand medicines and Pharmac, as patent requirements sought by the EU would have made medicines here more expensive by hundreds of millions of dollars a year — New Zealand refused and that is not part of the deal, the only country in the OECD to have that exemption.

Ardern described the deal as “high quality, inclusive and ambitious”, containing “ground-breaking commitments on environment, labour rights and gender equality as foundational parts of a trade and sustainable development chapter”.

“I am pleased that this FTA also includes a dedicated chapter on Māori Trade and Economic Cooperation,” she said.

While Ardern was drumming up support with European leaders at the NATO Summit in Madrid, Trade Minister Damien O’Connor spent the past week in Brussels nailing down the final details.

He said the deal provided “access for products that were previously locked out in the historically difficult to access European market”.

“This agreement delivers on what has been a long-standing objective of successive New Zealand governments — an FTA with the European Union, which will help accelerate New Zealand’s economic recovery at a time of global disruption,” O’Connor said.

‘Solid’ trade agreement
European Commission President Ursula von der Leyen said it was a “modern and solid” trade agreement.

“With this agreement, we should be able to increase trade between the two of us by 30 percent — that’s a big step”, she said at the media briefing with Ardern.

“Our farmers on both sides will benefit and they will benefit way beyond tariff cuts because we will work together on sustainable food systems.”

The EU is New Zealand’s third largest trading partner.

On the EU side, she said it meant European investment could grow by about 80 percent, a large number of food products geographical indications have been protected, and nearly all tariffs on exports to New Zealand have been eliminated.

It is a different kind of agreement, covering modern digital rules, and “several firsts”, said von der Leyen, for example, “sanctionable commitments” to the Paris Climate Agreement.

“This is the very first time that we take such commitments in a trade deal… and it contains, again, for the first time provisions on fossil fuels,” she said.

“And we show the same ambition on core international labor standards and on gender equality, to advance women’s economic empowerment.

“So this agreement will bring major benefits to our economies, but also to our societies.”

New Zealand and the EU have also signed an agreement for closer co-operation between law enforcement agencies, allowing greater information sharing and collaboration to help disrupt and respond to transnational organised crime, drug trafficking, money laundering, child sexual exploitation, cybercrime, violent extremism, and terrorism.

‘Deeply disappointed’ – Meat Industry Association
Red meat exporters are “extremely disappointed and concerned” with what they describe as a “poor quality” deal struck with the European Union, representing a “missed opportunity” for farmers.

The Meat Industry Association said the deal agreed will see only a “small quota” for New Zealand beef into the EU — 10,000 tonnes into a market that consumes 6.5 million tonnes of beef annually — “far less than the red meat sector’s expectations”, and one that continues to put them at disadvantage in a large market.

“We are extremely disappointed that this agreement does not deliver commercially meaningful access for our exporters, in particular for beef,” said chief executive Sirma Karapeeva of the Industry Association.

“We have been clear from the outset that what we need from an EU-NZ Free Trade Agreement is market access that allows for future growth and opportunity.

“Unfortunately, this outcome maintains small quotas that will continue to constrain our companies’ ability to export to the EU,” she said. “This agreement is not consistent with our expectations and the promise for an ambitious, high quality trade deal.”

Diversification was even more important with the increasing volatility in global markets and a high quality deal was “critical” to helping exporters broaden their access to other markets, said Karapeeva.

“This is a missed opportunity for farmers, exporters and New Zealanders,” she said.

“It will mean our sector will not be able to capture the maximum value for our products, depriving the New Zealand economy of much-needed export revenue at a time when the country is relying on the primary sector to deliver when it matters most.”

This article is republished under a community partnership agreement with RNZ.

People are going hungry even though New Zealand produces enough food to feed 40 million — and it is spurring calls for the country to “feed the five million first”.

Almost 40 percent of New Zealand households experience food insecurity, while 19 percent of children live in households that experience food insecurity.

Poverty researcher Dr Rebekah Graham said while working on her thesis on food insecurity, she interviewed a woman who walked for 90 minutes each day to get a free community meal.

“That was her only meal of the day. It was all she was eating.”

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Others went without to make sure their children had food, or were constantly trying to stretch food to make more meals from it, she said.

Dr Graham said the people she interviewed had a grim acceptance that this was normal.

“They would have loved high quality meat and they would have loved to have regular fresh fruits and veggies.”

Moderate food insecurity
About 33 percent of New Zealand households say they face moderate food insecurity, experiencing uncertainty about whether they’ll have enough food, or choosing cheaper, often nutritionally poor items.

About 7 percent of households experience low food security, meaning they run out of food and go without for a day or more.

For a long time it was mostly beneficiaries who experienced food insecurity but that had changed, Dr Graham said.

“You’ve got families on minimum wage, who are paying market rent, who have to live in the city, because that is where their job is. Some of these people are essential workers, so you need them in a city if you want your city to function. And when the cost of living keeps rising but your wages don’t, and when rent skyrockets, the food budget gets capped.”

New Zealand produces enough food to feed 40 million people, exporting much of it, including $16 billion worth of dairy, $3.7bn worth of beef and $3.9bn worth of sheep meat a year.

Export prices often push up prices charged for food in New Zealand.

NZ fruit, vegetables cheaper in Britain
Auckland University of Technology emeritus professor of nutrition Dr Elaine Rush said she had seen New Zealand fruit and vegetables sold cheaper in Britain than they were here.

Dr Rush has matched data on food and beverage exports and imports to nutritional needs and said what she found was eye-opening.

She said we are exporting high nutrient proteins and fat, and importing foods and these aren’t great from a nutrition stand-point, like carbohydrates and sugars.

As a result, we are fat, famished or starved in a land of plenty, she said.

In a paper on the topic she suggests: “A country that can produce more than enough high-quality food should feed its own first.”

After New Zealanders had enough good quality food, “then we can actually start thinking about looking after the rest of the world as well, because the trickle down effect hasn’t been working has it?

“All this money we get from these exports doesn’t seem to be making it easier for those at the bottom of the socioeconomic ladder,” she said.

Food production needs ‘reorientation’
Rush said the food production sector needed to be “reorientated” and she questioned whether, with a growing population, New Zealand was producing enough vegetables to provide five servings a day for everyone.

While there are a number of initiatives such as community gardens, food banks and even programmes to distribute food waste to hungry people, Dr Graham said each had its pros and cons and most did not address what was at the heart of the issue — a lack of money.

“We need to rethink how we distribute wealth across the country, so that all our citizens can do well.”

How this reorientation could work in practice was another matter.

One study modelled the effect of introducing taxes on unhealthy foods, such as sugar, while subsidising the cost of fruit and vegetables by 20 percent. It found such a scheme would deliver significant health gains.

There have also been calls for a National Food Strategy.

The Aotearoa Circle, a think tank with public and private sector partners, is tackling a strategy and has appointed KPMG as the secretariat.

Suffered heart attack
KPMG’s global head of agribusiness Ian Proudfoot is leading the project and has a personal interest in good nutrition.

In 2017, he suffered a heart attack and while recuperating he met many people living with heart disease. He was able to change his diet after his heart attack, but many people he met could not afford to.

“Our food system at the moment is delivering very poor health outcomes to many New Zealanders. The stats are well known. We’ve got some of the worst rates globally — and particularly among developed countries — in relation to things like obesity, diabetes, and cardiovascular disease.

“Our food system has undoubtedly put quite significant pressure on some of our natural assets, particularly our water.”

New Zealand food exports made the country $46.6 billion in the 12 months to February and that scale of food production complicated matters, he said.

“We have a food system that’s incredibly complex compared to most countries and particularly compared to any other developed country because we do rely so heavily on it to create our wealth.”

What started as a strategy for food, has grown into a much bigger task, Proudfoot said.

Understanding of food’s role
It quickly became evident what was needed was an understanding of food’s role in our country and any strategy needed to look at not just issues like food security, but economics, the environment and culture.

“If you’re looking for an ocean to boil, it’s this one. It crosses almost every ministerial portfolio – there’s 31 primary agencies in government with a role in the food system.”

The group had talked to some of the government agencies already. Some were more receptive than others, Proudfoot said.

The idea of “feeding the five million first” has also been floated at agricultural gatherings and it resonated with the sector, Proudfoot said.

Rather than using legislation to enforce such a concept, the sector could adopt it as part of ensuring the New Zealand brand has a good story to tell, Proudfoot suggested.

Food insecurity would not be solved in one or two years, he said, but over time the best case scenario was a New Zealand food system which was environmentally sustainable and provided New Zealand with the nutrition needed for good health at an affordable price.

It would also create prosperity for the country.

“The worst case scenario is we continue on our current track but out ability to access premium markets becomes increasingly compromised because we’re either not getting the health issues right, or we’re not getting the environmental issues right, or we’re not meeting our expectations that are our customers who pay us a premium for what we produce have on us.”

This article is republished under a community partnership agreement with RNZ.

The meat industry is waiting with bated breath to find out if there is any truth that New Zealand meat is linked to a coolstore in China where covid-19 has been found on packaging.

Reuters has reported the virus was found on beef and tripe products in a storage facility containing shipments from Argentina, Brazil and “essentially covid-free” New Zealand.

The virus was apparently found on more than 3500 products in the eastern Chinese city of Jinan, in Shandong province.

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Apart from saying where the products originated, Chinese authorities have not named the companies that shipped them.

New Zealand’s Ministry of Foreign Affairs and Trade said it had not been informed officially by Chinese authorities, and officials were trying to find the origin and veracity of the media reports.

In the post-cabinet briefing this afternoon, Prime Minister Jacinda Ardern said the government was advised yesterday that there had been positive covid-19 tests from packaging of beef from Argentina.

They were also advised that there were some New Zealand products stored in the same coolstore where the positive tests were returned.

Government seeks more information
Unlike some media reports, they were not advised that any New Zealand products had tested positive. The government was seeking more information on the testing.

“I want to get to the bottom of this … this is incredibly important to New Zealand. We are confident, of course, that our products do not and are not exported with signs of covid on them given our status as essentially being covid-free,” Ardern said.

Minister of Trade Damien O’Connor said there was nothing to suggest the virus originated in New Zealand.

“We have been aware of the Chinese investigating the possibility of covid spreading through frozen goods. It’s a very, very slim possibility. Genetic material can be found on the goods, we know that, but the risk of it spreading infection is very, very low.”

He said it was a timely reminder to exporters about the risks.

“If they have people who are sick, working anywhere in New Zealand even though we have no community transmission, they should take all precautions and make sure people don’t come to work.”

The Meat Industry Association said they were essentially in a holding pattern awaiting more information from China, with chief executive Sirma Karapeeva saying the science suggested transmission of the virus on frozen products was negligible.

‘No evidence’ of NZ implication
“We haven’t had any feedback from our members that suggests that their product has been caught up in this and they should know, they’ve got really close links with their importers in China. So I tend to agree with the minister, it’s not clear or seen any evidence to suggest any New Zealand product has been implicated.”

She said it proved China was serious about the risks of covid getting back in.

“They have stepped up their product testing on imports. They are testing all products as they come through the border, so clearly they are taking this very seriously and in a way it’s positive to see that they are focused on managing Covid within their own borders.”

Karapeeva advised people to keep calm and carry on.

“Now is not the time to panic, we have very good systems in place for food safety as well as for covid management and we are confident those systems are robust in managing transmission within New Zealand, so as long as companies follow the rules I think they should be fine.”

AgriHQ senior sheep and beef analyst Mel Croad said meat exports to China were heading into the busiest period of the year so any hiccup was a worry.

”From here until about March-April, our export volumes are ramping up every month just reflecting those higher processing volumes back here. It’s crucial that we have got a good flow into our export markets.”

The Ministry of Primary Industry’s assessment remains that the risk of covid-19 transmission by food or food packaging is negligible.

The Meat Industry Association said it was unfortunate New Zealand products seemed to be implicated in something with very little or no evidence.

This article is republished by the Pacific Media Centre under a partnership agreement with RNZ.

Both the Solomon Islands and Papua New Guinea governments have signalled changes to make their forestry industries more sustainable.

According to Loop PNG, the Papua New Guinea government will be putting a stop to the issuance of all new logging licences to foreign companies.

Forestry Minister Solan Mirisim who resigned as Defence Minister under the O’Neill led government, said licenses will only be issued to landowning companies.

READ MORE: Tarcisius Kabutaulaka: Logging bonanza hasn’t helped Solomon Islands landowners

“The minister is charged in ensuring that no more new licence is given to foreign companies, all existing players in the country go down to downstream processing by 2020,” he said.

He said that more needs to be done to ensure the forestry industry is sustainable.

“But what we can absolutely do about logging is this: We can replace the tree that we cut. But we are not doing that. You go anywhere in the logging area in PNG, are they doing reforestation? No. But the authority that’s supposed to do this is slack.”

Illegal deforestation
Deforestation is rife in Papua New Guinea, with 640,000 hectares of forest felled in the last three years. Much of the logging is illegal, prompting conflict between offending companies and indigenous landowners.

According to The Guardian, millions of tonnes of illegally felled logs are sent to China and PNG is China’s single largest supplier of tropical logs.

Illegal logging activity is often enabled through corruption typical of the previous government under Peter O’Neill.

Prime Minister James Marape has since pledged to stamp out such corruption and work more in the interests of indigenous landowners.

The Solomon Islands government has also discussed changes to the logging industry, with Prime Minister Manasseh Sogavare looking to halt all round log exports by 2023, reports SIBC news.

Sogavare will encourage a shift from round log exporting to downstream processing with more factories set up to process the timber onshore.

Twenty times the sustainable rate
According to environmental news website Mongabay, logging companies are clearing Solomon Islands forests at nearly 20 times the sustainable rate.

While Sogavare’s announcement appears to be a step in the right direction, there are concerns that any changes will be hindered by a majority of pro-logging MPs, many of whom are being paid by foreign logging companies.

The writing is on the wall for the fate of Peter Colmar’s kava exporting company, Sarami Plantation, now that the Minister of Agriculture, Matai Seremaiah has said: “I strongly recommend that the Vanuatu Commodities Marketing Board (VCMB) terminate his export licence forthwith”.

READ MORE: New data dispels reports of ‘tainted’ kava fears

The minister sent the short instruction to the Acting Director-General (ADG) of Trade, George Borugu, this week.

The minister recommended to the ADG to ask the board to take drastic steps to deal with Sarami Plantation in the face of growing concerns abroad, especially from Dr Mathias Schmidt in Germany and the Vanuatu Ambassador to the European Union, Roy Mickey Joy, in Brussels, both of whom fought tooth and nail to successfully defend the Pacific kava-producing countries’ export market in Europe.

Their tireless commitments since the kava ban in 2001, finally resulted in the ruling by the German Administrative Court to lift the kava ban in 2014.

In his urgent email to Ambassador Joy this week, Dr Schmidt wrote: “Today on Tuesday, January 10, I received a complaint from the US: they are being drowned in two-day kava, all exported from Peter Colmar in Santo. He is operating as ‘Sarami Plantation’, shipping ground, leaves and stalks as ‘kava’ to the US via New Zealand.”

Dr Schmidt listed the following export figures for 2016:

• Kumars Import: 25.82 tons

• Naturex Inc.: 24.52 tons

• Concentrated Alie Corps.: 7.02 tons and

• Starwest Botanicals: 2 tons

Dr Schmidt explained: “That’s almost 60 tons of non-noble non-root material sold as kava in 2016 by just one exporter. I thought the Vanuatu Kava Act had been changed, but if someone like Sarami Plantation can sell such quantities without any consequences, there must be more than just one person closing their eyes.

‘Next catastrophe’
“We need to stop this before the next catastrophe happens.”

In his letter to the Director of Biosecurity, Ambassador Joy wrote: “I am shocked and alarmed by the way and the manner in which Mr Peter Colmar has continued to conduct his shipment with ‘blind eyes’ from your staff and even those in the Customs and Border Controls.

“I am lost for words but can only compel the way and the easy manner by which the ‘Sarami Plantation’ has continued to effectively trade its kava shipment against all odds and without any sense of regularity control or SPS from our authorities.”

Ambassador Joy said he was disappointed that he and his exceptional team had spent six solid years and substantial resources to eventually revive the kava trade in Europe, only for one company to come in and destroy everything by exporting trash instead of noble kava.

He continued: “I am appealing to you to launch a swift investigation into the conduct of ‘Sarami Plantation’ and withdraw its export licence as soon as possible.”

The ambassador also copied his letter to the Prime Minister’s Office.

Meanwhile, the owner of the export company, Peter Colmar, lives in China and is understood to visit Vanuatu on a regular basis.

No call back
The Daily Post called Sarami Plantation in Luganville to speak to someone responsible concerning the reports leveled at the company.

In the latest development, all kava growers and exporters have from now until the end of next month to clean up their operations and cease for good, from the sale or export of two-day kava or kava mixed with ‘makas’ (adulterated kava).

The new Kava Export Standard is going to come into force on March 1 and all kava exporters are expected to comply with it.

The Biosecurity Director has already given the warning to all kava farmers and exporters from Luganville and Port Vila. He is reiterating the warning again because he has received pictures of dishes of ‘makas’ from his officers in Luganville only two days ago.

The director said: “My officers went to a particular nakamal and found kava ‘makas’ placed on the roof to dry. When they asked why, the owner confirmed a company is buying the ‘makas’ for export.”

He said Sarami Plantation is reported to be buying and mixing kava ‘makas’ with real kava for export to the United States.

The report has already reached the European Union.

Appeal to government
Asked to comment, he replied: “We at Biosecurity are appealing to the government to gazette the Kava Act Amendment of 2015 to give us extra-legal enforcement power to enforce kava export.

“While the existing law already provides us with legal power, we need the extra legal backing to put stricter control measures against farmers and exporters and other people for that matter, in particular owners of kava bars who sell ‘makas’ to the exporters”.

As of the middle of next month, all farmers are warned to stop selling two-day kava to buyers for local consumption and kava exporters.

The new law comes into effect on March 1 and if kava farmers and exporters are caught still selling and exporting two-day kava, the Director of Biosecurity reiterated that they would go one step further by blacklisting those farmers by advising exporters not to buy anymore kava from them.

“We are prepared to take such drastic measures to clean up the industry of kava export”, he confirmed.

Len Garae is a senior Vanuatu Daily Post journalist.

• New data dispels Vanuatu reports of ‘tainted’ kava fears – Vanuatu Daily Post

Papua New Guinea has threatened to stop trading with Fiji because of “unnecessary” trade restrictions on PNG products.

Trade, Commerce and Industry Minister Richard Maru has warned Fiji that it should expect “a serious trade war” if it fails to explain satisfactorily why it is refusing to allow PNG products to the country.

The products include PNG’s corned beef brand Ox & Palm and Trukai Rice.

“Over the last 10 years, [trade] ministers before me had tried their best to push Fiji to remove the ban on Ox and Palm and Trukai,’’ Maru said.

“This never eventuated, now is the time to take action’’.

Last year, PNG exported K16.6 million (NZ$7.2 million) worth of products to Fiji. It imported K52.2 million (NZ$22.9 million) worth of Fiji goods –a trade deficit of K35.60 million (NZ$15.6 million).

In 2014, PNG exported K4.4 million (NZ$1.93 million) worth of goods to Fiji while importing K48. 6 million (NZ$21.3 million).

Three months ago, Maru wrote to Fiji’s minister for tourism, trade and industry seeking clarification on the restrictions. No response was received.

‘No show’
“Also at the Melanesian Spearhead Group trade ministers meeting this year in Port Vila, I had arranged a meeting with the [Fiji] minister but he failed to show up,” Maru said.

“I was told by one of the officials later that they had received my later and they will respond as soon as possible, but this had no eventuated.”

Minister Maru said PNG had allowed Fiji to have an increase in trade with PNG for a long time and trade volumes were increasing for Fiji.

“We have allowed Fiji to have a long trade surplus with PNG for a long time and trade volumes are increasing. It’s not about the volume – it’s the principle.

“If you want to come and enjoy our open market you must do the same to us.’’

He said the PNG government would again write to Fiji’s minister for tourism, trade and industry “expressing our concerns”.

PNG is now giving Fiji 14 days to respond or a full trade war will be declared in the coming weeks.

Nadia Marai is a final-year student journalist from the University of Papua New Guinea. She visited New Zealand earlier this year on a Pacific Cooperation Foundation exchange.