Tough talking
Trade deal breakthroughs — and dead rats
Tim Groser resorted to brinksmanship in the final brutal hours of the marathon Trans-Pacific Partnership negotiations to secure New Zealand a deal on dairy.
The Trade Minister had to swallow a “few dead rats”. But there’s still expected to be enough of what Mr Groser earlier termed “foie gras” to make for a tasty trade package which the Government will sell hard once the deal made in Atlanta, Georgia, is out in public.
While Mr Groser had not secured a gold-plated outcome — as far as NZ’s prime export is concerned — by press time last night, the overall package is expected to be worth about $400 million a year when all commitments are made.
The 12 negotiating parties were expected to unveil an ‘‘agreement in principle’’ at a press conference scheduled by US Trade Representative Mike Froman for 2am NZ time today. Last night, a number of lastminute protests (notably by Vietnam over textiles) had the potential to derail that arrangement, although that was considered unlikely.
New Zealand is expected to get controlled access for dairy products to prime TPP markets such as Mexico, Canada, the United States and Japan. It was unclear last night just what constraints would be applied by the individual markets, but the trade levels were expected to be controlled by tariff quotas.
Mr Groser had to apply direct pressure on Mr Froman to get movement on dairy. American farm lobbyists had ramped up pressure, arguing that if NZ’s efficient farmers got increased access to sell more dairy products, that would threaten the livelihood of less-competitive US dairy farmers.
The NZ dairy sector will not get a major breakthrough for its exports of milk powders, liquid milk and butter, but there is expected to be significant liberalisation of cheese and yoghurt exports.
Senior dairy lobbyists said last night that they would “suck it up”.
NZ will make major gains for products such as kiwifruit, beef — including exports to Japan — and wine.
Sources close to the negotiations said they had not only been “brutal” but negotiators — and trade ministers — were “completely shagged”.
Importantly, the US has compromised with Australia over intellectual property protections for biologics, which are derived from biological sources including vaccines, blood, anti-toxins, human cells, proteins and antibodies, to treat diseases including cancer and rheumatoid arthritis.
This has cleared the way for another roadblock to a TPP deal to be removed following on from the autos issue, which was solved earlier in the five-day negotiating session.
The major regional deal will lower trade barriers in two-fifths of the world economy and set the commercial “rules of the road” for decades.