TPP deal still alive - NZ Trade Minister David Parker

The TPP negotiations taking place in Vietnam appear to have overcome several stumbling blocks and is close to being signed by the remaining 11 nations involved the agreement. It is now being called the ‘Comprehensive and Progressive Agreement for the Trans-Pacific Partnership’ (CPTPP).

New Zealand Trade Minister David Parker sat down with TVNZ 1’s Political Editor, Corin Dann, and insisted New Zealand has made progress in controversial areas of the agreement, such as the investor-state dispute clauses.

“We've got rid of them completely as between us and Australia, and 80% of the foreign direct investment from TPP countries into New Zealand which would be covered by those clauses comes from Australia. So we've effectively got 80% out, “ he says.

New Zealand went into talks with five areas it hoped to address - including protecting Pharmac’s buying model and who can buy our homes - and after discussions, “four and a half out of five” issues have seen gains made.

“The negotiations are largely complete and in a short period of weeks, we have improved it substantially for New Zealand,” said Mr Parker.

The US pulled out of the TPP deal with President Trump stating he’d focus on creating one-on-one deals with nations, but Mr Parker believes New Zealand isn’t likely to be one of those nations any time soon.

“If we had a one-on-one deal with America it would be a good thing, but we’ll be unlikely to achieve that in the short-term.”

Q + A
Episode 36
DAVID PARKER
Interviewed by CORIN DANN

DAVID From our position, we've been clear in the few weeks that we've been in government that we wanted to see some substantial changes. We've been clear that we're just committed to standing up for what's best for New Zealand. We had a number of problems, some of which we've already addressed, like preserving New Zealanders' right to control who buys our homes. And we've made progress on these investor-state dispute clauses which is so controversial. And we've made other improvements.

CORIN You couldn't get the investor-state dispute clauses out, could you? Or have you?

DAVID We've got rid of them completely as between us and Australia, and 80% of the foreign direct investment from TPP countries into New Zealand which would be covered by those clauses comes from Australia. So we've effectively got 80% out. We've got some other bilateral negotiations outside of the text, if you like, that are ongoing that we haven't yet concluded, but we're still trying our best to conclude. And inside the agreement itself, there is a narrowing of the scope—

CORIN What does that mean? ‘A narrowing of the scope’?

DAVID I'll give you an actual example. As the text stood, if a big multinational company was building a big infrastructure project in New Zealand under a contract with the government and they became dissatisfied and had a dispute, until the narrowing, they could have used these ISDS clauses to take that dispute to an international tribunal. They now no longer can, and if they've got a breach of a contract like that, they've got to sue the New Zealand government in the New Zealand courts, just like a New Zealand company would have to.

CORIN The fact is, though, a big Japanese corporate under this deal, if it's signed, could sue the New Zealand government if we changed the rules on them.

DAVID No, that's not correct most of the time. If, for example, we changed the regulation related to taxes or environment or labour laws or public health or did anything with our public schooling system or our public health system, no, they could not. There are some narrower areas where they could still make a complaint under these ISDS clauses, which is why we have instructed our negotiators not to agree them in future. But we haven't been able to successfully remove them completely from this one.

CORIN But that's the key point, isn't it? Because when you were in opposition and when Labour aligned itself in some ways with a lot of the people who had grave concerns about the TPP when you were in opposition, it was that type of thing that you railed against, and now here you are agreeing in principle to back the TPP 11.

DAVID We had five principles that were really important to us Land sales, which the last government said they couldn't fix. We've already fixed it. We wanted a decent Treaty clause. The Treaty clause is a very good one and has been found accordingly by the Waitangi Tribunal. We wanted the preservation of decent tariff reductions for our exporters. We wanted to get rid of ISDS clauses, and we wanted to protect Pharmac. The only one of those that we have only partially succeeded on is the ISDS clauses.

CORIN Isn't that the one that most people were concerned about?

DAVID Actually, I think the most important one to most people is actually about being able to control who buys New Zealand homes. That’s the one that I certainly feel most strongly about personally, and I think that’s been clear for years.

CORIN But isn’t the issue in terms of loss of sovereignty, that fear that corporates could take our government to court, like the tobacco case. Wasn’t that the one, and isn’t that the one that still the likes of Jane Kelsey and those are still very concerned about?

DAVID It is a totem. It is an example of where the investment protocols in trade and investment agreements have gone too far. We agree with that.

CORIN But they think you are a traitor for backing this deal because of that, because that still being allowed.

DAVID That’s pretty harsh language. I don't think they think that. I think that they realise that we have been handed this very close to completion, at a stage where the negotiations are largely complete and in a short period of weeks, we have improved it substantially for New Zealand in those ways that I have previously described. So four and a half out of five, well, better mark than I got on average at School Cert.

CORIN I want to take this bigger picture now. We’ve talked technical stuff here. Bigger picture, is this a sign that your government and the US Trade Minister are going to be pragmatic about these things?

DAVID Look, I will always stand up to the interests of New Zealand. The interests of New Zealand include trade. We all know that in order to buy the cars and the TVs and the computers and the medicines that we need from overseas, we have to sell things overseas in order to get the money to pay for our imports. So trade has always been important and it will always be important. There is an interesting thing happening in the world now with President Trump and others talking more protectionist language then we have seen before, being quite dismissive of some of the multilateral institutions, like the World Trade Organisation.

CORIN That is deeply worrying for New Zealand, isn’t it?

DAVID It is deeply worrying for New Zealand. We are a little country. We rely upon the rule of law. We have not got a lot of power to actually force our way in the world.

CORIN I mean, he has come to APEC with that message, saying he wants to do one-on-one deals and he’s going to push people around if they don’t do it how he wants to do it. But APEC is a vehicle for free trade, isn’t it?

DAVID I think actually think there are some things that have gone wrong with free-trade in the world. I think some of these investment protocols have gone too far. ISDS clauses is one example. Attempts to sort of prevent countries screening for certain investment classes is another. But you are quite right that New Zealand relies on the international rule of law. We think if we are dealt with unfairly overseas to the detriment of New Zealand, we should be able to go to someone to sort it out. We don’t think corporates should be able to sue governments. But we do think governments should have rights to sort out as a rules-based thing–

CORIN So what is your government’s strategy now? So the last government put huge effort into multilateral deals. Is it time just to be pragmatic and go, ‘Look, the world is moving away from that and we put our energy somewhere else’? Or do we just focus more determinedly on one-on-one deals like Trump is doing?

DAVID If we had a one-on-one deal with America, it would be a good thing, but we’ll be unlikely to achieve that in the short-term.

ENDS

Please find attached the full transcript and the link to the interview

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