Moore on China

Mike Moore makes some excellent arguments:

There are some who oppose New Zealand’s trade deal with , and want a boycott of the Olympics. It’s precisely because China depends on the global trading system that world opinion on now matters to the Chinese.

Thirty million people perished during the cultural revolution and Mao’s great leap backwards. World opinion didn’t matter to the Chinese then. Now it does, and that’s a good thing.

China is going through the same process as Japan, Singapore, and places like Taiwan. As living standards rise, a middle class emerges that seeks out better social outcomes. Wages in the Pearl River delta in China rose 13 per cent last year.

Seven thousand factories will close this year because wages have moved up and these jobs will head inland, or to Vietnam, even Africa. This is the virtue of free markets and globalisation.

For the first time the Chinese Government is answerable to its own laws – you can now sue the Government.

It’s no longer an atheist state; there are the beginnings of freedom of religion. Over 10,000 Chinese Muslims were allowed to go to the Haj in Mecca. Christians sued the Shanghai Government for wrongful arrest when they expressed their religious beliefs. This is an imperfect and uneven progress that should be celebrated.

All this is healthy and Prime Minister Helen Clark has hit the right note. …

The New Zealand /China trade deal is to be welcomed. Would our competitors turn it down? In fact, our advantage will last only a few years, if that, as others sign up.

All this exposes something else about New Zealand’s political process. Our Foreign Minister, Winston Peters, says he’s not a member of Government except when overseas and may not vote for it. How is this possible?

Peter Dunne has said he will vote for the deal but has the Chinese shaking in their boots by saying he won’t go to the reception. The Maori Party has taken different positions, but one MP said we shouldn’t trade with countries that pay lower wages than NZ. That means we can’t trade with Samoa, forcing them to pay more for goods from anywhere else.

At last the adults in the Labour and National Parties have taken control for a short time and done what is right for New Zealand. This deal is worth a few hundred million dollars to New Zealand, small compared to the Uruguay Trade round, and tiny compared to what this country will get from the Doha Trade round.

Why is it so small? Because the terms of China’s accession to the World Trade Organisation collapsed tariffs in agriculture by 90 per cent. Isn’t it a good thing that China is now inside the and answerable to its rules, obligations, and binding legal disputes system? The WTO and the Doha Round is still the biggest global game.

But New Zealand can do a deal with China and advance the WTO. It’s a melancholy fact the best thing I ever did was leave New Zealand to run the World Trade Organisation. China joined the WTO and the Doha Trade round was launched in my time. Modesty prevents me from pointing this out.

Completing the Doha round would be a better achievement, but to be fair to Moore he can’t be held responsible for that not happening!

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