In a landmark move, New Zealand is poised to enter a free trade agreement with the European Union, anticipated to be operational by 2024. Central to this agreement is New Zealand’s obligation to the Paris Agreement on climate change.
The trade deal mandates both New Zealand and the EU to effectively implement their climate targets set for 2030, a condition that New Zealand must meet to avoid any breach of the agreement.
New Zealand’s Climate Goals
Under the Paris Agreement, New Zealand has set an ambitious goal to significantly reduce its greenhouse gas emissions – targeting a 50 percent reduction from 2005 levels by 2030.
This translates to a decrease of approximately 150 million tonnes of emissions over ten years. The strategy to achieve this includes a dual approach: reducing emissions domestically and investing in international climate initiatives.
Diverse Political Views on Climate Action
The political response in New Zealand towards these climate goals varies. The National Party, while committed to the target, has not detailed its plan, especially regarding the purchase of offshore carbon credits – a key part of the strategy when New Zealand raised its commitment in 2021.
ACT, conversely, has suggested it might not adhere to the target, influenced by the actions of major trading partners, including China. NZ First shows hesitance in committing substantial funds for international climate efforts.
Legal and Trade Perspectives
Experts in legal and trade fields view the inclusion of a binding climate commitment in the trade deal as a significant development. Legal professionals from Chapman Tripp, Nicola Swan and Kate Wilson Butler, point out that New Zealand’s pledge to “effectively implement” the Paris Agreement marks a significant shift, as the country has typically avoided such binding commitments in treaties.
The Zero Carbon Act of 2019 is seen as a positive step towards meeting these obligations.
Should New Zealand retract its commitments under the Paris Agreement, it could face challenges under the trade agreement’s dispute resolution mechanisms. Economist John Ballingall underscores the uniqueness of incorporating a binding sustainability chapter in a trade deal.
Environmental Standards in Trade
The trade agreement also includes clauses against the dilution of environmental laws for trade advantages. Such clauses, while common, highlight the importance of maintaining environmental integrity in trade agreements.
The Path to Ratification
The trade agreement, signed by both the EU and New Zealand, now awaits parliamentary ratification. Discussions have been raised in the EU parliament regarding the environmental impact of transporting New Zealand’s agricultural products to Europe, but these concerns did not lead to amendments in the agreement.
