‘Trade’ Treaties – Let’s Lose The Delusions of Grandeur

The main ‘trade’ deal on offer in 2018, the latest version of the TPP is, to all intents and purposes, the original version of the TPP without the US. Some of the clauses insisted on by the US have been ‘suspended’ but could be reactivated if and when the US decides to get back in the game.

Towards the end of 2017 the trade negotiators toured the country to publicize this latest version. They described it as the best deal they could negotiate for New Zealand. This is definitely not to be confused with the best deal for New Zealand.

Our politicians would like to have us think that New Zealand is a key player, a linchpin, in these multilateral ‘trade’ treaties. Sadly, this is not so. To put it bluntly, nobody much cares what New Zealand wants or even if New Zealand is part of the agreement at all. Our negotiators have very little leverage.

We are a tiny country. Most of the other countries involved in negotiations have cities with larger populations than our entire country. Our market is tiny by their standards. We have already removed most of our tariffs on imports – thanks to the rush of blood to the head by our politicians of every persuasion in the 1980s. We mainly export agricultural products. Most of the other countries have their own food producers to support and don’t particularly want or need our agricultural products. And we have a better relationship (though arguably not nearly good enough) with our tangata whenua than most other nations do with their indigenous peoples. New Zealand’s Treaty of Waitangi clauses apparently go down like a lead balloon in ‘trade’ treaty talks.

The cost to New Zealanders of being part of these ‘trade’ agreements is high. It includes opening us up to litigation by overseas corporations, harsher patent and copyright laws leading to the curtailment of open source, and inhibiting the free flow of information and knowledge essential for public healthcare and preventing climate change. Then there is the possible damage to non-export based local businesses, for example through opening up of procurement to international interests and cheaper imports, often made using underpaid labour and under lax health and safety standards.

There is something fundamentally wrong – and, ironically, very much anti free market / free trade – with agreements that force countries to import goods and services that they neither want nor need, and can produce themselves. The other problem is that countries, per se, do not produce these goods or services. They are produced on the whole by privately-owned companies. Governments are trading the people’s public good for companies’ private gain.

Perhaps it’s time to lose the delusions of grandeur and acknowledge that we are not world trade leaders. We are too small to matter. If we are too small to matter, do we really need to be part of these agreements? The sky would not fall in if we didn’t sign on the dotted line.

New Zealand exporters could still export to these countries, perhaps with higher tariffs. Or perhaps not, depending on how much the product they are trying to sell is actually wanted. And we would have more say over what comes into our own country.

Perhaps instead of lobbying the government to sign away public rights for their private gain, our New Zealand exporters could work on diversifying and developing products that citizens of other countries really want. The government could encourage this and work on levelling the playing field for our own local producers not involved in exporting – which is by the far the biggest sector of our economy. Our tradeable sector contributes only 30% of our GDP and has virtually flatlined since 2004 despite our ever-increasing number of ‘free’ trade deals.

The Labour Party in opposition pledged to carry out an independent analysis of the costs and benefits of the TPP before it was implemented. This is desperately needed in order to see whether the best deal on offer is anywhere near good enough for us. Let’s do this, straightaway, in 2018.

Leave a Reply