Informer - October 2015
There are times when events on the international stage dominate local news and that’s been very much the case over the last couple of weeks. The Prime Minister’s surprise visit to meet New Zealand trainers and troops based at Taji in Iraq helped highlight the harsh, dangerous conditions they are serving in as well as the constructive work being done in the fight against ISIL. His visit there followed a hard hitting speech to the United Nations General Assembly in New York where Mr Key accused the UN of failing Syria and other nations in crisis.
But the big news last week was the announcement of agreement between 12 Asia Pacific countries on the Trans Pacific Partnership. The agreement provides terrific new opportunities for New Zealand exporters. New Zealand now has a trade agreement with the world’s number 1 and number 3 trading economies, the USA and Japan.
This represents roughly 40% of global GDP and one third of world trade. As a trading nation we export 27% of our GDP so this is big news in our region. It means huge opportunities have been opened up for our primary producers and manufacturers. Overall the TPP will eliminate tariffs on 93% of NZ exports to our TPP Partners making it much easier to sell our products into those markets.
Our negotiators achieved the best outcome for the dairy industry that could be negotiated. For example all tariffs on cheese to Japan will eventually be eliminated and tariffs on infant formula into the US will be eliminated over 10 years. Dairy was always going to be difficult. There’s no denying a better deal on dairy would have been helpful to the sector but as it stands the new TPP arrangements for dairy access into those markets is certainly improved on what was possible pre TPP.
All in all this is a modern global trade agreement. It explicitly requires countries like Brunei, Malaysia and Vietnam to ban child labour. All partner countries will be forced to crack down on human trafficking or they will be not able to take advantage of other parts of the agreement.
Finally on a local note, I want to congratulate everyone involved with this year’s very successful Scallop Festival. I always enjoy attending and this year was no exception. The weather held off perfectly for the day and visitors from far and wide enjoyed another taste of Whitianga hospitality and scallops.