The European Parliament this Wednesday gave the green light to the free trade agreement between the European Union and New Zealand, which will eliminate tariffs New Zealanders on EU exports and which, for the first time, includes sanctions in case of non-compliance with climate and labor commitments.

Thus, the European Parliament – with 524 votes in favor, 85 against and 21 abstentions– approved the ratification of this trade agreement which, according to MEPs, constitutes a “central element” for the EU to strengthen its “position, role and importance” in the Indo-Pacific region.

Once it comes into force, all New Zealand tariffs on the community club’s exports will be eliminated and, after seven years, 98.5% of tariffs of the EU on New Zealand trade.

The agreement contemplates the protection of all geographical indications of wines and distilled beverages of the EU, like the vPolish odka, Rioja or Prosecco, as well as a list of 163 “famous” food productsand defends European producers of sensitive agricultural goods, such as beef and dairy products.

It also includes, for the first time, binding commitments – and sanctions in case of non-compliance – with the Paris Climate Agreement and with the fundamental rules of the International Labor Organization (ILO).

The MEP of the European People’s Party (EPP) and rapporteur of the report Daniel Caspary assured in a press conference prior to the vote that it is the trade agreement “more modern” that the EU has achieved and that will serve as an “example” for future treaties.

“Has a one stop shop for SMEs (small and medium enterprises)an independent chapter for digital trade, and takes into account obligations regarding the fight against climate change in a binding manner and with sanctions,” Caspary explained.

Bilateral merchandise trade between the EU and New Zealand reached 9.1 billion eurosthe community club being the third commercial partner of this South Pacific country.

The European Commission (EC) expects that trade between both regions will increase by 30% and that investment flows of the EU in New Zealand will increase by more than 80%.

Therefore, the MEPs They emphasize that this trade agreement creates opportunities for European companies to enter the contracting market on equal terms with local companies.

“Our companies will have more export opportunities, especially SMEs, and we will have a better position in global competitiveness to determine what the future will be like.” International Trade future,” said Caspary.

Member States are expected to give the green light to the agreement next Monday, November 27 and is expected to come into force in mid-2024, once it has been ratified by New Zealand.