Leaders give Trump the Anzac salute
English and Turnbull vow to press on with trade deal — minus the US
Take notice Donald Trump. Bill English and Malcolm Turnbull have vowed to try to press ahead with the TransPacific Partnership ( TPP) without you.
In a formal communique released yesterday afternoon following their first prime ministerial talks, the two stressed that the TPP is a key promoter of regional economic integration and a driver of growth, competition, innovation and productivity.
“In light of the intention of the United States not to ratify TPP, the two Prime Ministers agreed that Australia and New Zealand would work together with other TPP partners on the way ahead.”
Their two- fingered salute to @ realDonaldTrump will no doubt be heard all the way to the White House.
But a reality check: their joint stance is unlikely to spark the President to unleash another Twitter tirade. Neither PM is going to make the mistake of calling Trump out directly on this topic at this time.
Both Prime Ministers made a strong commitment to free trade and open markets, saying they led to jobs.
And Turnbull offered an oblique criticism: “At a time of very rapid change — economic and technological — that produces anxiety, people can be deluded in some cases that the answer is to throw up walls. That in my view is absolutely the wrong thing to do.”
The decision by the two Australasian Prime Ministers to join forces and fight the tide of protectionism unleashed by the US President will be welcome elsewhere in the Asia- Pacific region. The commitment to open trade also includes advancing the Regional Economic Comprehensive Agreement and working to secure a successful outcome from the World Trade Organisation ( WTO) ministerial meeting in December.
Officials are already looking at whether ( and how) the TPP could be amended to proceed without the United States. That is assuming New Zealand and Australia can persuade the nine other signatory nations to stay in TPP and perhaps bring in more participants like South Korea and Colombia to rebuild critical mass.
They will also want to leave the door open to the United States to reenter the TPP at a later ( possibly postTrump) stage, particularly as pressure builds ( as it will) from US farmers and businesses to ensure they do not face competitive trade disadvantage in the region as a result of TPP trade liberalisation.
Trump claimed during last year’s campaign that implementing TPP would lead to the continuing “rape of our country” and that trade relations should be looked at “almost as war”.
That’s why is it not surprising that the Prime Ministers take seriously Trump’s push to investigate retaliatory tariffs, forge bilateral trade deals where US interests must come first, investigate border taxes and even examine withdrawing from US participation in the WTO.
Implementing any — or all — of these policies could turn Asia- Pacific trade upside down, severely undermine the rules- based trading system and pave the path for trade wars.
The Trump presidency has had a disruptive effect on global politics, trade certainties and the Western nations’ defence paradigm.
But perversely, it has also had the effect of drawing New Zealand and Australia closer.
The Anzac spirit was repeatedly
Neither Prime Minister is going to make the mistake of calling Trump out directly on this topic at this time.
stressed by both Prime Ministers at their press conference and informal talks.
Typically — as noted by Mainfreight’s Don Braid, who was present at the PMs’ talks with business — New Zealand and Australia tend to obsess about the competitive advantage each scores over the other in trade deals, whereas their combined might would have more impact in the current disruptive environment.
It will be a challenge for both sides to stick together in the new environment and not be peeled off by bigger players.
These were Turnbull’s first prime ministerial talks with English, who still very much wears his status as a newly minted Prime Minister.
The pair’s easy bonhomie has yet to approach the close relationship Turnbull enjoyed with former PM John Key. As former investment bankers, Key and Turnbull had plenty in common — they’ve each played in the financial shark tank and are independently rich.
English’s interests are more grounded in financial and political operational management as the former Finance Minister who has presided over a growing economy. But he does have Turnbull’s open respect for the way in which the NZ economic reform agenda has been managed.
On the TPP, English has also displayed considerable grit.
Before yesterday’s talks he told me New Zealand had “nothing to lose” by pushing for a coalition to reinvigorate TPP. English made the point that it might be “naive Kiwi optimism”, but New Zealand ( and Australia) should fire on anyway.
For his part, Turnbull was magnanimous in praising English’s “successful stewardship” of NZ’s finances.
“I have always been an absolutely unalloyed fan of New Zealand. Your distinguished predecessor used to say it was because New Zealand does not have as much money to waste as Australia. But I know it was the efficiency of the Finance Minister.”
Also on the agenda in Queenstown yesterday were talks between the two Prime Ministers and their economic czars: Australian Treasurer Scott Morrison and NZ Finance Minister Steven Joyce.
Australian Ann Sherry, who heads Carnival’s cruise ship business, and Adrian Littlewood, who is Auckland Airport’s boss, also held talks with the Prime Ministers.
The pair are Australian and New Zealand co- chairs of the Australia New Zealand Leadership Forum.
Other NZ businesspeople to join the meeting were Braid and Mark Adamson, Fletcher Building’s chief executive. From Australia, Sherry brought with her David Thodey, chairman of the CSIRO and Brendan Lyon, chief executive of Infrastructure Partners Australia.