Some reflections on the importance of trade in the forthcoming NZ election.
New Zealand has long occupied the moral high ground on international trade. Since we first reformed the economy in the early 1980s, moved away from manufacturing protection and agricultural subsidies, we have realised that we need an open global economy and trade rules we have had a hand in making to ensure we could compete internationally. That has led successive governments, of left and right, to champion freer trade through the World Trade Organisation and through a series of ambitious, high quality and comprehensive free trade agreements.
Today, even after all this effort, the world is still not a safe place for our international businesses. Arguably they enjoy vastly improved access to global markets than they once did, but business models are changing, new sectors are emerging particularly in services, protectionism is on the rise and non-tariff barriers continue to plague trade growth. My colleague expressed these challenges well in her recent post – “Ten ways in which New Zealand’s trade policy offers a brighter future for all of us”.
We are delighted that the trade spokespeople from the four major parties in the current election responded positively to our request to them to lay out their party positions on our election page. We are grateful to Fletcher Tabuteau MP (NZ First), Hon David Parker (Labour), Barry Coates MP (Green) and Hon Todd McClay (National). You can read their well-expressed views here. We are particularly pleased that all four parties express support for trade (albeit with some sharp differences about the value of certain trade agreements). That bodes very well for New Zealand’s future, whoever forms the government after 23 September.
It is not the purpose of this post to suggest who New Zealanders should vote for. We have too much respect for New Zealand’s democracy for that. Trade is only one of a number of key issues on which the election will be decided but it is an important underpinning of a more productive and competitive economy which can support greater investment in areas New Zealanders feel deeply about including health, education and social well-being. In our view, two things have to happen if trade is to be a winner in this election.
First, the next government must listen to the country’s international businesses. There are many mechanisms for this including through the newly established Ministerial Advisory Group, whose role we hope will be strengthened and expanded. Businesses know what the international trade challenges are better than governments. Strengthened public private partnerships need to be developed. Both business and government need to share the task each from their vantage points of explaining the importance of trade to public stakeholders and devising policies and strategies to make sure the benefits of trade are more widely spread.
Second, bipartisanship needs to be restored. This will help ensure there is continuity of policy direction between governments. Bipartisanship was broken in the fractious debate around the Trans Pacific Partnership (TPP) and today we find no complete alignment of view between the parties about the future of this important agreement. This is not good for New Zealand’s international business.
On 24 September the task remains as it was on the 23rd: we at Tradeworks and NZIBF stand ready to work with the incoming government to secure advantage for New Zealand in global markets.
This post was prepared by Stephen Jacobi, Executive Director of the NZ International Business Forum.