STATEMENT TO THE FOREIGN AFFAIRS, DEFENCE AND TRADE SELECT COMMITTEE TRANS PACIFIC PARTNERSHIP AGREEMENT AMENDMENT BILL

NEW ZEALAND INTERNATIONAL BUSINESS FORUM 

STATEMENT TO THE FOREIGN AFFAIRS, DEFENCE AND TRADE SELECT COMMITTEE

TRANS PACIFIC PARTNERSHIP AGREEMENT AMENDMENT BILL

25 AUGUST 2016

STEPHEN JACOBI, EXECUTIVE DIRECTOR

Mr Chairman, Honourable Members.

Thank you for the opportunity to speak to our written submission.

My name is Stephen Jacobi and as Executive Director of the New Zealand International Business Forum I am speaking on behalf of the business leaders from a range of sectors, which make up the Forum’s membership.

The organisations they represent are among New Zealand’s largest internationally-oriented businesses and peak business associations.

Mr Chairman, Honourable Members

As the NZ International Business Forum, we are particularly interested in the way New Zealand enterprises and our economy as a whole integrate with the global economy.

From this perspective TPP is a very welcome development and one, which we support strongly.

As we have previously submitted, TPP offers a number of significant trade and investment advantages to New Zealand across all sectors of our economy, in both goods as well as services, in the knowledge economy, innovation and investment, and in terms of new business models.

We believe that overall the new trade and economic environment created by TPP across the Asia-Pacific region will lead to job creation, better living standards and sustained economic growth for New Zealand.

Our submission notes that these gains are achieved in the main without the requirement for significant policy change or adjustment in New Zealand.  Such changes that are contemplated are in our view mostly marginal in terms of their impact.

Our submission accordingly commends the implementing legislation.

We support the amendments to the New Zealand Tariff in Part 10, which pave the way for significant tariff cuts on New Zealand products entering TPP markets.

We are pleased to see the provisions giving effect to the new screening threshold for certain kinds of foreign direct investment, namely Part 7, seeking to amend the Overseas Investment Act 2005.

In our view New Zealand needs more, not less, foreign investment to expand the capacity of our domestic industries to develop world-class enterprises of scale and to add value to volume.

The new screening threshold should further facilitate the flow of capital into New Zealand.

Since we made our written submission to you, we have given closer consideration to one element of the implementing legislation, namely Part 2 Amendments to Copyright Act 1994.

Specifically, we have noted the arguments of advocates for a more straightforward approach to the implementation of copyright term extension.

We support the extension of the copyright term from ‘life plus 50 years’ to ‘life plus 70 years’ which brings New Zealand into line with most other jurisdictions.

In our view the content-creation sector has made a persuasive case for the immediate implementation of the copyright term extension rather than a staged approach.[1]

Simpler implementation would help to reduce confusion for consumers and the industry, and avoid additional costs and complexity for content creators and licensing bodies.

We commend these views to you.

I would also like to comment briefly on the commencement of the implementing legislation, Clause 2.

There is clearly uncertainty over the timing of the entry into force of TPP.

The situation in the United States in particular is of great concern.  We are very disappointed that it may cast the early implementation of TPP into doubt.

NZIBF considers that passage of the New Zealand implementing legislation would send an important signal to the US and others.

This would affirm the value of TPP and the importance of deeper regional economic integration to trading partners both within and outside of TPP.

Therefore NZIBF urges the early passage of this Bill, recognising that the eventual entry into force of the Agreement may be unavoidably delayed by broader considerations.

I would like to conclude, Mr Chairman and Honourable Members, by noting that the TPP exercise has served to underline the importance of early, genuine and robust consultation throughout any trade negotiations process.
Trade and economic reform have made a significant contribution to New Zealand’s prosperity and living standards, but it is also clear that in New Zealand and elsewhere there is a climate of unprecedented concern about the pace and extent of globalisation.

We would agree with others that the process for consultation on trade issues needs to be enhanced.

Such consultation needs to include not only stakeholders in the private sector but also the general public.

And it needs to be complemented by greater advocacy by both business and the Government of the benefits of trade and investment for New Zealand.
Mr Chairman and Honourable Members, NZIBF commends this legislation to you and urges the New Zealand Parliament to pass the TPP Agreement Amendment Bill as soon as possible.