Nov 16, 2013 

Criticism of TPP unfounded

Free-trade linkages are important for our economic prosperity. Anyone over 45 can remember what happened when we lost the benefits of our first free trade agreement, that which secured preferential access to the UK. We faced an economic crisis. Our balance of payments went deeply into the red, we had recession after recession and unemployment went through the roof.

Starting with CER, successive governments have built an impressive network of bilateral and regional agreements that secure access to some of our key markets.

We are almost at the point where we need to stop worrying about where we can sell our product and instead worry about where we can get the best price for what we are selling.

The Trans Pacific Partnership (TPP) offers us the opportunity to expand this network into two of the three major regions that have high tariffs against our exports – North America and Japan.

In North America we face heavy protection for a number of agricultural exports and we pay higher tariffs than key competitors such as Chile and Australia because they have FTAs with the US and we don’t.

And this will only get worse as the EU negotiates its own FTAs with the US (it has FTAs with Canada and Mexico). Japan has 13 FTAs signed including with Switzerland and Chile (real competitors of NZ) and is negotiating TPP and with the EU.

TPP is our only opportunity to ensure equal access into these important markets. This is why ExportNZ supports this negotiation so strongly.

We are privileged to be part of the process and we literally cannot afford not to be part of it. But incredibly, some seem to be opposing this negotiation.

Some criticise the secrecy around the negotiations. These negotiations can’t be conducted in public, but I wonder whether the critics have tried hard to receive briefings from Ministry of Foreign Affairs and Trade officials on the negotiating process.

We know that regular briefings are being given to the Labour trade spokesman and also to the relevant select committee. ExportNZ and a range of exporters ask for briefings after each negotiating round from lead negotiator David Walker.

He agrees to these requests every time. They give us a good understanding of the key issues under negotiation and where things stand. Others should be asking for similar briefings.

Some of those criticising the TPP are the same people who have been criticising past agreements because they have lacked strong and binding commitments on trade and labour. TPP will have such language. Why are these groups not supporting TPP?

Other groups have criticised the lack of strong and binding commitments on trade and the environment. Again, TPP is likely to have such a chapter. Again, why are these people not welcoming TPP with open arms?

Some say this agreement is going to sign away our sovereignty forever. Really? We suspect that TPP will, like all our agreements to date, contain a standard termination clause.

The most recently signed agreement, with Taiwan, says the following: “This agreement shall remain in force until one party gives written notice of its intention to terminate it, in which case this agreement shall terminate 180 days after the date of this notice of termination.”

How can an agreement that can be terminated bind us irreparably as some are suggesting?

Others warn about the evils of compulsory investor state dispute settlement. We have had such clauses in FTAs and Bilateral Investment Treaties for years. Have we ever been sued?

Others say that we will have to end our Pharmac policy and/or agree to outrageous US demands on patent and intellectual property protection. Where is the evidence of this?

The negotiators tell us that they are not expecting this type of outcome on Pharmac (the minister, Tim Groser, has also given strong reassurance in this regard) and suggest we study outcomes such as the US-Australia FTA as an example of what might be an outcome on intellectual property. Has this agreement required radical change in Australia?

Most recently, people have begun attacking TPP because they say it is an anti-Chinese strategy. This is rubbish.

Groser has made this clear several times. Indeed all signs are that China is giving very positive consideration to joining TPP one day – if TPP is a good agreement.

Rather than give so much space to conspiracy theorists and those outright anti-US in their views, we would rather the media asked the question – can New Zealand afford not to be part of TPP? We think there is only one answer to this – no, we can’t afford to leave this process.

It is a once-in-a-generation opportunity to secure high-quality access for our exporters into markets that really matter.

• Catherine Beard is executive director of ExportNZ.