Hayes chasing lucrative EU deal

Wairarapa MP John Hayes says securing a free trade agreement with the European Union, the aim of his recent trip to Europe, could generate between $300-$500 million for Kiwi exporters.

Mr Hayes said our relationship with Europe, New Zealand's third largest market, is culturally, legislatively and economically important.

Mr Hayes visited Denmark, Sweden and Belgium to "build engagement" with European select committees and the European Parliament in Brussels.

When asked about the cost of the trip, he said: "The cost is that it could be worth between $300 million and $500 million to us."

Mr Hayes was joined on the trip by former Labour leader Phil Goff, and foreign affairs, defence and trade committee members Paul Hutchison and Su'a William Sio, MP for Mangere.

New Zealand is one of only nine countries which has to pay full duties on food exported to the EU.

Mr Hayes said a free trade agreement would put an extra $300-$500 million into the pockets of Kiwi exporters but a framework agreement must be concluded first. "That's a gain worth chasing and that is what the team I've been leading has been doing," Mr Hayes said. "If we don't have a good agreement we could be left out in the cold, so what we're doing in a strategical sense is working on our relationships."

Mr Hayes said the logistical challenges to negotiate a framework agreement were significant.

The recently concluded Lisbon Treaty requires the parliaments of all 27 member states and the European Parliament to agree to any prospective agreement.

Mr Hayes said that all of the parliamentarians they met were concerned about the ongoing financial crisis.

"Many say it has another five years to run, especially for Greece and Spain," Mr Hayes said. "What is obvious, however, is that our economy and circumstances are doing better than elsewhere in Europe. Even in Denmark and Sweden, unemployment rates are much higher than in New Zealand."