Labour is set to initially back a New Zealand First Bill that would legislate against a potential crucial clause in the Trans Pacific Partnership free trade deal.
Fletcher Tabuteau’s Bill would negate the ability of foreign companies to sue Governments over law changes that harm their business.
Labour Leader Andrew Little says they will support the legislation at its first reading as they have concerns about investor state dispute proceedings.
This is a massive shift in policy for Labour, putting them firmly on the extreme left. They have a proud legacy of supporting trade agreements but they are saying they will vote for a bill which would basically guarantee NZ would never ever get to sign another free trade agreement.
This is not just about the proposed TPP. Investor state clauses are now very standard in trade agreements. And they are about protecting NZ companies also. You may recall that the NZ Super Fund is suing the Portugal Government over the fact they treated the money invested by the NZ Super Fund differently to other investors in a bank. Without such provisions, then NZ companies can get treated differently.
The reality is Labour has signed trade agreements with investor state provisions. They are now voting for a bill that would have made such agreements impossible. This is again not a minor shift – this is a major reversal of 20 years of pro-trade policies from Labour.
The ASEAN FTA was negotiated by Labour and concluded in August 2008 and has investor state provisions.
The China FTA negotiated by Labour has investor state provisions.
The Thailand FTA concluded by Labour in 2005 has investor state provisions.
The Singapore FTA concluded by Labour in 2000 has investor state provisions.
So Labour signed FTAs with these provisions from their first year in office to their last year in office. They are totally standard in FTAs.
Their new policy to support a bill banning any trade agreements with them, is a de facto policy to never again sign a free trade agreement, and to walk away from all the trade agreements they concluded in Government. It’s pathetic pandering to the far left.