We are TPP enthusiasts. The benefits of TPP could be substantial for New Zealand. TPP stands to create our largest free trade area. It could transform the way we business in the Asia-Pacific region, and help build growth and jobs.
So, what is TPP?
Trans-Pacific Partnership – aka TPP – is an evolving agreement between twelve member economies, aimed at bringing down barriers to trade and investment. TPP will put in place a new set of rules making the way we trade with member economies simpler and fairer and making it easier and cheaper to do business with each other. New Zealand should be very proud about its involvement in TPP. With Brunei, Chile and Singapore we started the TPP movement, which has gained momentum to become the biggest game in town as far as world free trade deals go. Australia, Canada, Japan, Mexico, Peru, the United States, Vietnam and Malaysia have all subsequently joined. Thailand, the Philippines, South Korea and other members of APEC are all potential members.
What's happening with TPP?
We are well on our way to completing an agreement – but good things take time. Free trade agreements are complicated. All countries need to give a little in order to achieve the greater good. A number of deadlines have come and gone, but substance needs to drive the negotiating agenda. TPP will be completed once negotiators have developed consensus positions to put to Ministers. Then the final agreement, once signed, needs to be ratified. In New Zealand the this requires a Parliamentary process, including public submissions. Any laws that need to be changed require Parliament’s approval. Once all this is complete the Government ratifies the agreement and when enough other parties have done the same TPP can come into force.
Myths about TPP?
TPP is a secret negotiation.
The Reality – Trade negotiations cover a lot of sensitive commercial and economic issues. We would get nowhere if they had to be held in a public forum. Negotiators are sharing the broad parameters of the negotiations and, as far as possible the details and progress being made. Stakeholders who register their interest can meet with the negotiators at the TPP negotiating rounds. And as soon as the parties reach an agreement the full agreement will be available to everyone.
TPP will allow corporations to sue governments.
The Reality – Every country which signs the TPP will retain the right to regulate to protect, among other things, the environment and public health; and in New Zealand's case honour the Treaty of Waitangi. Multinational companies, such as the big tobacco producers, will not automatically gain the right to sue the Government, certainly not before they have met a number of conditions. And in fact multinational companies, just as domestic companies do, already have the right to sue the Government.
TPP will force us to make changes to our intellectual property laws that will take a major toll on New Zealand.
The Reality – The area of intellectual property is very complex. More intellectual property protection may suit some people, such as those in life sciences or technology companies doing business extensively overseas but may not suit other people, such as those working in fast moving software industries. Just as in a number of other areas of the TPP, the IP chapter has not been agreed yet and the negotiators will be weighing up a number of considerations to ensure net benefit to New Zealand.
TPP will trash the environment.
The Reality – We can be very confident that our government will not give up the right to protect New Zealand's environment. Provisions in trade agreements we have already signed with some TPP economies strongly suggest the government will retain the right to regulate to protect the environment.
TPP could force us to change laws (like our employment law) that are important to us.
The Reality – To be a global citizen it is inevitable that we give up a degree of our sovereignty. We've done that already by signing all sorts of international conventions and agreements. The fact remains New Zealanders will always determine their own destiny and will want to live by laws, domestic and international, which are just, fair and humane. It is worth remembering too, that if laws do need to be changed as a result of TPP this will only be done after Parliament has agreed to these changes. TPP is also likely to contain a chapter upholding core labour standards.
TPP will let foreigners buy our land.
The Reality – Foreigners are already allowed to buy our land, subject to the approval of the Overseas Investment Office, and when they do they must abide by all our laws and regulations to look after that land and anyone who works on it.