The UK’s trade deal with New Zealand is a baby step. We need a giant leap – Open Democracy

After leaving the EU, the UK government set out an ambitious plan to agree trade deals with a large number of countries.

The deal with New Zealand, which was signed last month, is the second of the new agreements. As it happens, the deal was concluded on the same day that the IPCC released its most recent report, with further stark warnings about the negative impacts of climate change.

We know that we need all the tools in the box to prevent the worst of global warming, and trade rules have significant impacts in key areas like energy and agriculture, so how does this deal measure up to the climate test?

New Zealand isnt an obvious first choice as a trade partner: it ranks 55th in the list of countries the UK does trade with, with a relatively small economy and low tariffs, and, frankly, its very far away. In fact, the economic benefit to the UK from the New Zealand deal will be negligible.

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One scenario modelled in the impact assessment predicted the deal could in fact cause the UKs economy to contract by 0.01%. The assessment released with the final text, in which the government decided to use a different modelling specification to calculate the impact, predicts an increase of 0.03% to GDP over the next 10-15 years, and thats based on what some commentators have called an exaggerated economic forecast. By comparison, the latest estimates from the Office for Budget Responsibility predict Brexit will reduce UK GDP by 4%.

So why did the UK pick New Zealand as a priority? This question would be far easier to answer if the UK had published a trade strategy, which it hasn't.

However, it is clear that the deal is driven in no small part by New Zealands membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a trade agreement between 11 countries around the Pacific Rim. The UK applied to join the agreement last year, as part of its Indo-Pacific tilt, unveiled in the Foreign Office integrated review, Global Britain in a Competitive Age. The deal with New Zealand is therefore more important as a stepping stone towards these broader aims than it is as a source of trade benefits.

So what visible difference will the deal make to those living in the UK? One outcome of trade deals is a reduction in tariffs which can lead to reduced prices for consumer goods. This is probably the most tangible effect the trade deal will have. A substantial proportion of UK imports from New Zealand come from the food and drink sector, so UK consumers could stand to benefit from cheaper Kiwi goods.

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The UK's trade deal with New Zealand is a baby step. We need a giant leap - Open Democracy