New Zealand minister appears to push back at Trump’s global trade threats

An aerial view of Singapore’s portAn aerial view of Singapore’s port

Public statements at the ASEAN economic ministers’ (AEM) meeting in Singapore this week have generally been affable remarks on the importance of trade with Southeast Asia, but New Zealand’s representative appeared to use his remarks on Saturday to push back against a more belligerent U.S. trade policy.

Damien O’Connor, New Zealand’s minister of state for trade and export growth, used his opening remarks for the consultation on AEM-CER (Closer Economic Relations) to state four ways that his country would promote its interests, with some appearing targeted toward recent remarks from U.S. President Trump.

“Firstly, we’ll be defending the rules-based system centered on the WTO,” O’Connor said at the AEM on Saturday at the Shangri-La Hotel in Singapore.

Defending the WTO

Trump told Bloomberg News, in an interview published on Thursday, U.S. time, that he would pull the U.S. out of the World Trade Organization (WTO) if it didn’t “shape up,” claiming that the organization which has been a bedrock of global trade has treated the U.S. “very badly” and calling it the “single worst trade deal ever made.” To be sure, Trump has described many trade deals as “the worst ever.”

O’Connor said New Zealand’s second step would also work to strengthen the regional trade architecture, pointing to agreements such as the ASEAN-Australia-New Zealand Free Trade Agreement, or AANZFTA, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and other agreements around ASEAN.

As a third, he said New Zealand would aim to build “like-minded coalitions to support global and regional public goods,” which he added included APEC, or the Asia-Pacific Economic Cooperation, a 21-member regional economic forum, which includes the U.S. APEC works to facilitate trade via faster customs procedures and harmonizing regulations.

O’Connor added the fourth measure his country would take was advocating for “open ascension” into multi-lateral agreements, such as CPTPP, and potentially ASEAN.

Pursuing multi-lateral cooperation

That’s a stark contrast with the Trump administration’s policy, which has been to advocate for bilateral deals, rather than multi-lateral ones. Indeed, Trump pulled the U.S. out of the Trans-Pacific Partnership (TPP), claiming that he could get a better deal on a bilateral basis. Since then, the U.S. doesn’t appear to have reached a deal with any TPP country.

Talks to update the NAFTA, or North American Free Trade Agreement, with trading partners Canada and Mexico, both of which are part of the CPTPP, the successor agreement after the U.S. exited TPP, appear to be mired. While the U.S. heralded reaching a deal with Mexico, it has missed a Friday deadline to reach an agreement with Canada.

Leaked off-the-record remarks by Trump in the Bloomberg interview that he wouldn’t compromise with Canada, and that “it’s going to be so insulting they’re not going to be able to make a deal,” reportedly have complicated the talks. Bloomberg reportedly denied the leak of the off-the-record remarks was from its organization.

Congress must approve any negotiated agreements to revise NAFTA; terminating NAFTA to approve a bilateral deal with Mexico would require Congressional approval, which analysts believe is unlikely to pass muster.

Within New Zealand, the government appeared to be aiming to short-circuit any populist revolt against trade pacts, such as recent events in the U.S.

Trade For All Agenda

O’Connor on Saturday pointed to New Zealand’s Trade for All Agenda.

“New Zealand as a country is entirely dependent upon our [relationship] to trade and we always will be,” he said. “We still have a number of people within our own country who are uncertain and some really doubtful about the benefits of trade. So we have a commitment as a government to embark upon a consultation exercise through our whole country. We are explaining to people in the community that trade and dealing has some short term and long term benefits for all of us.”

To be sure, the U.S. representative at the ASEAN meeting on Saturday made public remarks that were more conciliatory than the White House has made about trade.

Deputy U.S. Trade Representative (USTR) Jeffrey Gerrish noted that ASEAN was the fourth-largest trading partner of his country, after Canada, Mexico and China, and he pointed to the Trade and Investment Framework Agreement, or TIFA, with the region, saying “we have a good track record for working together.”

But even then, he hinted at the need for changes to “enhance” the relationship.

“Especially as ASEAN becomes more mature, more developed, more prosperous and more important trading partners, we want to be sure that our engagement, our TIFA reflects that importance,” Gerrish said. “We see it as a vehicle for strengthening all of our trading relationships with ASEAN.”

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