Chance of good deal ‘low’
English says NZ and other TPP nations will explore treaty without America
The Government doesn’t plan to sit around waiting for a call from the United States for a bilateral trade deal to replace TPP after the US withdrawal. It is joining Japan, Australia and Singapore to test the resolve of other countries to carry on with the TransPacific Partnership without the US.
Australian Prime Minister Malcolm Turnbull is reinforcing the possibility that China and Indonesia could join — and South Korea too is known to be interested.
Prime Minister Bill English said he was surprised last week to hear Japan’s PM, Shinzo Abe, arguing the merits of TPP even without the US — Abe had previously said it would be “meaningless” without them.
English said the views expressed by Japan, Australia and Singapore, along with NZ’s own view, “would add up to making an effort to find out what we can do with TPP rather than just dropping it and waiting and hoping to get a call some time”.
While New Zealand had long wanted a free trade agreement with the US, President Donald Trump had made it clear that any bilateral deals, which might be attractive to New Zealand in concept, would need to have significant benefits for the US.
He was not impressed with Trump’s suggestion that a deal could be dumped in 30 days if a trade partner “misbehaves”.
“That’s one aspect of it we would find unattractive,” he said yesterday.
He thought the chances of a good deal with the US were low. “If you ask me today I think there’s a pretty low chance of that happening in a form that we would find satisfactory — but wouldn’t want to rule it out, any more than we would want to rule out other versions of progress on free trade.
“Bear in mind it is not the only game in town for us.”
There could be some political will for the Regional Comprehensive Economic Partnership talks to pick up, he said. Progress was being made on talks with the European Union and the Gulf states.
He had asked Trade Minister Todd McClay to go to the US as soon as is practical to talk to his counterpart, Robert Lighthizer, about developments once he is confirmed in the job.
In the meantime McClay will be taking soundings from the other trade ministers in TPP countries. They are expected to meet within two months — possibly in Chile.
Trump signed a directive ordering officials to withdraw America from the TPP. But he indicated that the 11 other countries of the TPP — including NZ — would be approached to negotiate a one-on-one deal with the US.
The directive told officials “to begin pursuing, wherever possible, bilateral trade negotiations to promote American industry, protect American workers, and raise American wages.”
Later Trump told union leaders at the White House that the US was going to have “one-on-ones”.
“And if somebody misbehaves, we are going to send them a letter of termination, 30 days and they’ll either straighten it out or we’re gone.
“We’re going to have plenty of trade,” he said. “But TPP wasn’t the right way so we’re going back . . . one on one, and that’ll be beautiful.”
The US already has free trade deals with six of the TPP nations: Australia, Canada, Mexico, Chile, Peru, and Singapore. It does not with Japan, NZ, Vietnam, Malaysia and Brunei.