To go or woe with the WTO?

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In our latest Trade Working blog Stephen Jacobi and Stephanie Honey look at prospects for #WTO #MC13.

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National: The boldest-ever Trade push

by | Sep 13, 2017 | Election2020

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Guest post: Hon Todd McClay, Minister of Trade

In the world today, there is a divide between those countries that are prepared to set clear Trade objectives, and those who that turn towards protectionism, risking a stall to their economies.

China has asserted its priorities under One Belt, One Road.  It is their vision of the trading architecture necessary to fuel the growth that has lifted hundreds of millions of Chinese out of poverty.

The Pacific Alliance grouping of Chile, Colombia, Mexico and Peru aims to deepen economic integration with the rest of the world.

Britain has hired a free-trading New Zealander to lead their trade negotiations post-Brexit.  In doing so, they have signalled that opening up doors beyond Europe is the best way to maintain their prosperity.

Japan, the world’s third largest economy, is meeting its challenges by embracing reform, and showing leadership to conclude TPP11.

Under this Bill English-led Government, we are now at the front of the queue to progress free trade outcomes with all of these partners, and beyond.  We’ve shown leadership and commitment to get to this point, because we understand the importance of Trade to our economy.  We also understand the costs of not being at the negotiating table.

NZ earns more than $70 billion a year in exports.  That’s more than our spending on health, education, welfare, superannuation, defence and policing combined.  More than 620,000 jobs are dependent on trade.

Following on from our government’s release of Trade Agenda 2030 in March this year, National has set out its priorities for the next three years.

A re-elected National Government will seek to launch high-quality and comprehensive FTA negotiations with the EU, the UK, Sri Lanka, and MERCOSUR.

We aim to complete negotiations with the TPP11, the Pacific Alliance, and RCEP.

We will upgrade existing FTAs with China, Singapore, and ASEAN.

And we will advance greater access with India, Russia and the GCC.

Collectively, the new trade deals will progress New Zealand’s free trade goods exports coverage from 53 per cent to 78 per cent.  It will unlock markets for 2.5 billion new consumers in 47 countries, with a total GDP of $62 trillion.

Domestically, TPP11 is the litmus test for all political parties that are committed to free trade.  Even discounting the strategic advantages, TPP11 will create $2.5 billion to our economy annually, slash tariffs by $222 million each year, open access to Japan (among 4 new FTA countries), and create tens of thousands of jobs.

As a small trading economy, we cannot afford to be bystanders.  Turning our backs on TPP11, or failing to advocate for fairer and better market access with new or upgraded FTAs, or failing to front-foot the reduction of non-tariff barriers—in short, not showing leadership on Trade—will do us calculable and demonstrable economic harm.  It will mean lost prosperity for every New Zealander, and lost jobs for thousands of people.

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