As global trade uncertainty rattles traditional alliances Paul Beare explores why more New Zealand businesses are setting up shop in the UK – not just to bypass US tariffs, but to seize strategic opportunities in a shifting international landscape.
Whenever the old order is disrupted, we see the usual effects – outrage, confusion, bafflement, and strategic re-evaluation. The Trump administration’s sudden and inconsistent tariffs have precisely that effect.
No-one quite knows how the current global trade uncertainty will shake out, but we have already seen clients in NZ – and beyond – scrambling to deal with the impacts in the short- and long-term. And it’s clear the sudden impact is already taking effect across the world.
As a UK accounting firm specialising in helping companies globally set up in the UK, we’re uniquely positioned to see how the tariffs are impacting business decisions. The evidence? We’ve seen an increase in New Zealand companies, together with their counterparts across the ditch in Australia, exploring ways of setting up businesses in the UK.
Troubling times
In recent months, our conversations with NZ businesses considering setting up and operating in the UK all have a clear motivation; to bypass high US tariffs whilst maintaining good access to international markets. Capitalising on the more favourable trading conditions between the UK and the US, their next growth frontier is to look to Europe, using the UK as their launchpad.
There’s no doubt that this is being driven by fears that US tariffs will have a material impact on import and export margins in the short- and medium-term.
Why the UK? The reasons are simple: The UK has long had a strong trading association with New Zealand, fuelled by commonalities in language, business culture and legal systems. That is further fuelled by the fact that many Kiwis still look to the UK for their overseas experience, with many living, working, or indeed settling, in the UK. Anecdotally, this current eruption of volatility has added further fuel to that existing partnership.
Paradigm shift
This shift highlights three important developments:
- New Zealand companies are adapting quickly: This disruption isn’t going away any time soon, and NZ businesses are responding with agility. Using the UK as a base for US and European expansion is a smart, future-focused strategy. For many NZ businesses, this is more than trade, it’s about long-term resilience and growth.
- A renewal of UK-NZ trade ties: It’s been a well-trodden path for decades but shifting trade alliances have dented the ties between the UK and NZ since Brexit. The recently signed UK-NZ Free Trade Agreement is also helping rekindle this connection, offering tariff-free access on a range of goods and creating more favourable conditions for investment and business migration.
- The UK’s resurgence as a player in global trade: The last decade has seen the UK diminished as an economic power, in part driven by Brexit and a continued search for a suitable trading position with emerging markets. By positioning itself as a friend of the US, the UK has again proved its longevity and resilience as a centre of international business. From a rapidly evolving economy, London’s continued status as the global financial centre, a well-educated workforce, stable legal framework and strong reputation for welcoming foreign capital, the UK is once again a key location for businesses across the world.
And it’s for that reason that NZ companies are using the UK as a bridge to the European marketplace: it is accessible from the UK, and, despite Brexit, trading links remain strong. With last week’s reset agreement hammered out by UK Prime Minister Keir Starmer and EU president Ursula von der Leyen, running a European operation out if the UK is getting easier and more cost effective.
Strong market signals
Recent research shows why this shift makes sense. A survey by UK accounting software company Sage found that that UK scale-ups – companies that have sustained 20 percent or more annual growth in employees or revenue over three years – are outperforming global growth averages and delivering a turbo charge to UK economic picture.
What’s fuelling this? Technology adaptation plays a big role. 90 percent of respondents identifying tech investment as a key growth driver for their businesses. Nearly a quarter (23 percent) report having fully integrated artificial intelligence into their operations, indicating the increasing role of AI in business processes across the scale-up sector.
This is happening despite inflation and funding pressures. Yet, 89 percent of these high-growth firms expect their growth to accelerate further in 2025, and 94 percent remain confident in the UK as a business base. In fact, 95 percent plan to maintain their headquarters in the country.
That kind of confidence shows the UK is thriving as a business ground, offering compelling proposition for global businesses looking to expand. And for New Zealand companies, it’s not just about where the UK is today, it’s where it’s heading. A growing focus on digital transformation, investment in green infrastructure and pro-business regulatory frameworks all point to a market that welcomes innovation and rewards scale.
Looking ahead
We’re in unpredictable times. Between global conflict, political instability, and shifting trade policies, certainty is hard to come by. Tariff’s fuel anxiety and short-term thinking
But, as James Skinner, Founder & Chief Executive of CANZUK, the pressure group promoting greater integration between Canada, the UK, Australia and NZ recently pointed out, “Trump’s tariffs are a challenge, but they’re also a catalyst.” Arguing that Canada can lead by diversifying into CANZUK markets, Skinner says that if “Australia and New Zealand can anchor Pacific stability… the UK can bridge to a broader Commonwealth resurgence.”
Whatever lies ahead, New Zealand companies must think carefully about their next steps and ask the hard questions:
- Is the US a reliable long-term trade partner?
- Will tariff policies remain volatile?
- Are there more strategic expansion options elsewhere?
We believe the companies that are successful over the next decade will be those that embrace agility, not just reacting to global forces but actively positioning themselves in regions that support innovation, reward enterprise, and offer stable, long-term partnerships.
Finding the answers won’t be easy, but for now, it’s not a surprise that more NZ companies are looking to the UK as an island of stability in choppy global seas.
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