NZ Herald on TPP

December 3rd, 2012 at 2:00 pm by David Farrar

The editorial:

Trade is these days recognised as a universal benefit even if countries still make heavy weather of bargaining for it.

I wish that was true. NZ First and Greens oppose almost all trade deals, and elements within Labour are anti-trade also.

It is important that countries signing up to an investment treaty indicate at the outset the sort of health and environmental regulation they will uphold. John Key reaffirmed as recently as last week that New Zealand will not give up its public medical purchasing system, Pharmac, under pressure from US pharmaceutical manufacturers. Pharmac was not the only possible “deal breaker”. Mr Key also said the Government would not sign a that allowed dairy tariffs to remain at present levels. New Zealand, as Trade Minister Tim Groser has also made clear, is aiming for a “gold standard” agreement and has no reason to settle for less. The TPP’s original four signatories set the standard and they should stick to it. If others want to do a weaker deal, they are in the wrong talks. The TPP means business.

What I would welcome is an equally clear statement from the Government on the IP provisions. Their negotiating position to date has been excellent – no change to our domestic laws. However the fear is this may be compromised later on. A pro-TPP website has also been launched – Trade Works, by a group of businesses. I agree trade works. I don’t agree that US copyright laws work, or are suitable for New Zealand.

TV3 reported:

Green Party co-leader Dr Russel Norman and Ms Kelsey both claim the TPP will form a legally-binding agreement which will impact on future Governments.

“The cabinet effectively can sign them off and make them binding on us without us having any say about it. Parliament has very very little role to play in this process,” says Ms Kelsey, but Mr Hooton disagrees.

“If, after time, we don’t like it we can always pull out so there’s no question of sovereignty,” he says. “We remain sovereign.”

The facts appear to me on Mr Hooton’s side. Clause 20.8 of the existing TPP (it is an expansion being negotiated) states:

Any Party may withdraw from this Agreement. Such withdrawal shall take effect upon the expiration of six months from the date on which written notice of withdrawal is received by the Depositary.

Some people are against all trade agreements. I’ve yet to find one that the Greens or Jane Kelsey have supported. This is ironic as the China FTA has been a huge economic boon with massive increase in exports to China.

With TPP, there are definitely some proposed provisions that are not good for New Zealand. But they are just proposals at this stage, and to date New Zealand has been resisting them. This is a good thing. Of course at some stage, there may be some compromises (but recall this is a 11 party negotiation, not a bi-lateral so a lot depends on where the majority of the parties wishes lie) and one has to take a view on the final package as a whole. It might be great for NZ as a whole. It might be mildly beneficial or it might not be beneficial, either slightly or significantly.

Until we see a final agreement, my position is to keep opposing the provisions I feel are bad for NZ, but to retain an open mind on any final agreement. Ideally of course I want a TPP which has as many wins for NZ as possible. I also want it to be wins for other parties, and the US would actually benefit in the long-term if they dropped their silly tariffs (as has been the case for NZ) and also gave up trying to have copyright laws that damage the Internet. So I see the NZ position as not being bad for the US, but actually good for them also – they just have vested interests back home they try to placate.

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24 Responses to “NZ Herald on TPP”

  1. bhudson (4,741 comments) says:

    So Russel Norman want the taxpayer to invest in ‘Green Jobs’, but he doesn’t want us to be able to sell the output to anyone.

    That makes sense!

    (Well, truth be told, it makes as much sense as any other part of their economic policy – One trillion Kiwis for your latte anyone?)

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  2. Graeme Edgeler (2,972 comments) says:

    NZ First and Greens oppose almost all trade deals

    NZ First’s opposition is primarily to free trade deals with developing nations. Last I heard, they supported a free trade deal with the US, for example.

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  3. Reid (16,699 comments) says:

    Until we see a final agreement, my position is to keep opposing the provisions I feel are bad for NZ

    I had understood it would be ratified before being revealed. I may be wrong.

    And I agree the IP clauses would be very bad if based on the US.

    My issues with the TPP generally to date are the secrecy which is extreme, even for an international treaty and the way the US corporate lobbyists are driving some agendas, like the IP potential issue.

    Groser knows what he’s doing and I’m very pleased we have him where he is, there would be no better person in NZ, however this will be Key’s flagship FP achievement in his career as PM and that must put pressure on signing up to less than ideal positions.

    The thing about negotiating with the US is that the US never signs up to anything that doesn’t give it the main share of the benefits. It’s never a 50/50 and is hardly ever a 60/40 either. That’s an issue.

    One thing we should do is offer US citizens who want to migrate here favourable terms under the treaty – very favourable terms. There will be many highly skilled US citizens looking for paradise in the coming years and we should take as many of those as we can, provided they don’t settle in Auckland, of course. We just won’t let them.

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  4. Matthew Hooton (135 comments) says:

    Reid – a treaty is certainly not ratified before being revealed. The final agreed text gets revealed at or before the signing ceremony. Then each country goes through a ratification process.

    The New Zealand ratification process is outlined here: http://www.mfat.govt.nz/Treaties-and-International-Law/03-Treaty-making-process/index.php It involves Select Committee hearings and of course Parliament has to legislate to give effect to the specific provisions of a treaty.

    The US ratification process is even more public (and I doubt is even possible in the current political environment in Washington): http://www.senate.gov/artandhistory/history/common/briefing/Treaties.htm

    Each country has a different process.

    So I don’t know why Dr Norman and Prof Kelsey say there is no input into treaties before ratification. Perhaps the good doctor and the good professor haven’t had time to study this matter.

    It is obviously clear from her comments this morning, about the TPP binding New Zealand for a 100 years, and us not being able to pull out of it, that she must not have had time to read clause 20.8 of the existing TPP treaty.

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  5. Mark (1,502 comments) says:

    I have real concerns regarding both copy write and extradition treaties with the US and it is an area where the government should tread with great care as far as the US is concerned. I do not have much difficultly with a free trade agreement with the US however as countries have discovered that trade deals with the US are never free.

    In addition the US has a highly protectionist resolve when it comes to agriculture which makes it very difficult for NZ to make inroads on FTA’s. Agreed that Groser is the ideal negotiator here but hopefully they are prepared to walk away from poor deals rather than get sucked into issues that compromise NZ sovereignty in any way.

    For example under no circumstance should a NZ citizen be able to be extradited to the US for breaking US laws if the acts were committed outside the US unless they are also crimes in NZ. As I understand it that is currently the position and it should not change.

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  6. Graeme Edgeler (2,972 comments) says:

    So I don’t know why Dr Norman and Prof Kelsey say there is no input into treaties before ratification. Perhaps the good doctor and the good professor haven’t had time to study this matter.

    Matthew – if you don’t know what they are talking about, you should probably give up political commentary.

    What is obviously being talking about is the lack of any possibility for amendments to the treaty . New Zealand will sign the treaty, and then decide whether to ratify it or not, but we can’t amend the treaty between signing it and ratifying it. We can’t say “we’ll ratify the treaty if you agree to drop X from it, and amend Y to Z.”.

    Ratification is all or nothing: the government ratifies the text agreed with other countries, or it does not. NZers will never have an opportunity to say (like at a select committee looking into an ordinary bill): “we love the idea of a TPP, but only if we don’t give up A.” A will either be in it, or not, and then take it or leave it.

    Which I really hope you understand.

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  7. Graeme Edgeler (2,972 comments) says:

    For example under no circumstance should a NZ citizen be able to be extradited to the US for breaking US laws if the acts were committed outside the US unless they are also crimes in NZ. As I understand it that is currently the position and it should not change.

    This is a trade treaty, not an extradition treaty.

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  8. Yvette (2,763 comments) says:

    Matthew Hooton – The New Zealand ratification process is outlined here: http://www.mfat.govt.nz/Treaties-and-International-Law/03-Treaty-making-process/index.php It involves Select Committee hearings and of course Parliament has to legislate to give effect to the specific provisions of a treaty
    ______________

    Graeme Edgeler – Ratification is all or nothing: the government ratifies the text agreed with other countries, or it does not. NZers will never have an opportunity to say (like at a select committee looking into an ordinary bill): “we love the idea of a TPP, but only if we don’t give up A.” A will either be in it, or not, and then take it or leave it.

    One or both of you are talking krap.

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  9. Graeme Edgeler (2,972 comments) says:

    So I don’t know why Dr Norman and Prof Kelsey say there is no input into treaties before ratification.

    Tried to edit my comment, but it wouldn’t let me. Wanted to add this summary:

    We get input no input into treaties before ratification, only input into whether treaties are ratified.

    It would also be great if you could point me to a single instance of a treaty’s ratification being rejected by New Zealand, through public input, or any other reason.

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  10. Graeme Edgeler (2,972 comments) says:

    Yvette – the two statements you quote of Matthew’s and mine are not inconsistent.

    There are select committee hearings. There may be legislation. But neither can change the text of the treaty. If Parliament refuses to pass the necessary legislation, the government just won’t ratify the treaty. But Parliament can’t amend the treaty. That’s all or nothing.

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  11. Matthew Hooton (135 comments) says:

    Graeme, that is not what is “obviously” being talked about.

    This morning, Kelsey was specifically asked whether NZ could pull out of the TPP. She said no, and then went on about the ratification process, nicely – as the good far-left propagandist she is – slipping in “effectively” and “”very very little role” (when in fact it is quite a big role).

    And, as you very well know, in pretty much all international negotiations the negotiating text is kept secret between the parties until or close to finalisation. Right now, there is a UN climate change conference going on in Doha. Not sure you will find the current negotiating text very easily, yet I don’t hear the Greens and Kelsey complaining about that. There objection to the TPP is because it facilitates globalisation, and their “principled” arguments against it are subservient to that political agenda.

    On your further comment, the process has only been in place since the 1990s, so I don’t have an example of a treaty being rejected as a result of it, but it is totally wrong to say parliament couldn’t (a) prevent the executive from ratifying a treaty, (b) refuse to pass associated legislation and (c) require the executive to withdraw from it after ratification.

    So, if a Green/Mana/Kelsey/Edgeler government gets elected, never fear, you can withdraw from any finalised TPP and de-engage New Zealand from the global economy.

    Kelsey and the Greens’ are being at best, highly misleading in what they say about the TPP.

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  12. Yvette (2,763 comments) says:

    OK, Graeme.
    The point is the general public are not going to know what is in this treaty until it is revealed ready for signing and at that point it is take the whole thing or leave it.

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  13. Graeme Edgeler (2,972 comments) says:

    it is totally wrong to say parliament couldn’t (a) prevent the executive from ratifying a treaty, (b) refuse to pass associated legislation and (c) require the executive to withdraw from it after ratification.

    I agree. Which is why I never said ANY of those statements was true.

    I said (in several different ways) that Parliament cannot amend a treaty. It can’t do this before ratification, or after ratification. Do you disagree?

    After the treaty text is agreed between various countries, will NZ voters get an opportunity to say “we like it, but take line 112 out?” I say the most we will get to say is “Line 112 is so bad, we shouldn’t ratify this”. We get input into ratification, we do not get input into the treaty itself.

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  14. Matthew Hooton (135 comments) says:

    Actually Yvette, this is what I think will happen:

    1) Some kind of deal will be signed. For it to be acceptable to the four original TPP members (NZ, Singapore, Chile and Brunei) it will have to involve significant liberalisation of agriculture (this will be a bottom line for NZ and also Chile). The agreed text will then be fully public.

    2) The US House of Representatives and/or Senate will not approve the text as negotiated and will either reject it or make material amendments to it, particularly with regards to agriculture. (This is possible under their system when the President does not have fast-track trade authority, which he does not at present.)

    3) The failure by the US to ratify the agreement will mean that either (a) the expanded TPP will sit in limbo (with NZ, Chile, Singapore and Brunei just continuing with the current deal) or (b) the parties will need to go back to negotiations.

    The one scenario that will not happen is that the TPP will be agreed in secret, ratified by all 11 parties without significant public debate, and then become permanently binding on New Zealand for 100 years. But that is what Kelsey is claiming.

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  15. Graeme Edgeler (2,972 comments) says:

    The point is the general public are not going to know what is in this treaty until it is revealed ready for signing and at that point it is take the whole thing or leave it.

    Yes. I’m not sure whether Matthew actually dispute this, but yes.

    Matthew is certainly (likely to be) right in his claims about our ability to withdraw ratification, although that would be a drastic step that I’m not sure our Government has ever taken.

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  16. Matthew Hooton (135 comments) says:

    Graeme, in fact parliament could sort of decide to say they like the treaty, ratify it, but take line 112 out, if line 112 requires enabling legislation. This is what countries do (not usually us admittedly) when they sign up to a WTO deal but then don’t quite around to implementing it.

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  17. Graeme Edgeler (2,972 comments) says:

    Our Parliament could indeed pass legislation which failed to enact all the legislative changes needed to give effect to a treaty in domestic law.

    What would follow would likely be that the Government then wouldn’t ratify the treaty.

    If it did ratify the treaty, line 112 would be binding on New Zealand at international law.

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  18. Matthew Hooton (135 comments) says:

    Yes, but someone would have to bother suing us. And if we lost, we can always say, “fuck you, we are pulling out (under the existing clause 20.8)”

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  19. Reid (16,699 comments) says:

    Yes, but someone would have to bother suing us.

    Yes but Matthew some of the parties behind this are known to be quite litigious, so they probably would sue us, wouldn’t they.

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  20. david (2,194 comments) says:

    Not sure what you are getting at Graeme. Are you suggesting that we should have 4 million negotiators on the NZ side? or a referendum on each suggested clause after each suggested change by negotiators on behalf of each party? Surely that is what we have negotiators for isn’t it?

    And I would expect them to take a balanced view across the whole of the economy that may be affected in the interests of benefiting the whole country to the best level possible. An unenviable task at the best of times, requiring them to give a little here to gain a bit more over there which is sure to piss someone off at every step and will need to be sold well for people to understand.

    Of course the Kelsey’s of this world will pick nits till the cows come home because they are incapable of taking a “whole-world” view of something as broad sweeping as this proposal.

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  21. Matthew Hooton (135 comments) says:

    Reid, see for yourself in the WTO context at http://www.wto.org/english/tratop_e/dispu_e/dispu_by_country_e.htm

    You’ll see that nobody has ever bothered suing us at the WTO (we are the goody-two-shoes of world trade, of course) while we have been quite active.

    For a company (or corporation) to sue us, they would have to be convinced it was a major priority for them, because it its time consuming and expensive. Given the size of our market, our refusal to legislate would need to be egregious. And, of course, the government could always say “we are about to get on with that, just as soon as we can find time in our parliament.”

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  22. Reid (16,699 comments) says:

    WTO decisions are made primarily by diplomats, the TPP will be a cross-over between corporates and countries so I’m not sure WTO history will be a reliable predictor.

    For a company (or corporation) to sue us, they would have to be convinced it was a major priority for them, because it its time consuming and expensive. Given the size of our market, our refusal to legislate would need to be egregious.

    Yeah but even in NZ the market for say pharmaceuticals would make it worthwhile particularly if say the US pharma companies split their costs by filing a class action against us.

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  23. Graeme Edgeler (2,972 comments) says:

    Not sure what you are getting at Graeme. Are you suggesting that we should have 4 million negotiators on the NZ side? or a referendum on each suggested clause after each suggested change by negotiators on behalf of each party? Surely that is what we have negotiators for isn’t it?

    That may be exactly why we have negotiators. And it may be a wonderful thing. And perfectly proper and appropriate.

    But it will still be perfectly correct to say that we as average New Zealanders don’t get into input into the treaty. That it may be a good thing that we don’t, wouldn’t change the fact that we don’t.

    I am drawing a distinction between the process of input that average New Zealanders have into legislation – where we can appear before a select committee and it can change the text of the law – to the input we can have into treaties – where we can appear before a select committee which cannot change to text of the treaty.

    Whether this is a good thing is a different argument entirely, all I am stating is that it is an accurate thing.

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  24. Matthew Hooton (135 comments) says:

    Graeme, I’m not sure its even true to say that average NZers don’t get to have input into the treaty. There have been many opportunities for consultation – see http://www.mfat.govt.nz/Trade-and-Economic-Relations/2-Trade-Relationships-and-Agreements/Trans-Pacific/index.php#involve This may not be the kind of input some people want, but it would be wrong to say there has been no input, or that there won’t be opportunities for further input. Also, MFAT encourages debate, even linking to none other than Kelsey’s webpage! (see http://www.mfat.govt.nz/Trade-and-Economic-Relations/2-Trade-Relationships-and-Agreements/Trans-Pacific/1-TPP-Talk/1-TPP-talk.php )

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