The Trans Pacific Partnership will be Good for New Zealand


It took five years of intense negotiations and political controversy—and last week, trade diplomats finally gathered in New Zealand to sign the Trans-Pacific Partnership (TPP) free trade agreement.

Now comes the hard part: The politicians still must approve it.

The signing on February 4 was merely a ceremony—a necessary formality, but only a single step on the long road to TPP’s enactment.

The massive trade deal involves a dozen Pacific-rim nations whose combined economies contribute more than one-third of the world’s total output. The U.S.-based Peterson Institute for International Economics says that over the next decade, TPP could boost global incomes by nearly $300 billion per year.

So far, however, only Malaysia has ratified TPP.

Almost everywhere, the deal has fallen under sharp scrutiny. At the ceremony in Auckland, protestors greeted the signers with outrage, shutting down the central city.

In the United States, top presidential candidates have savaged it. The two major Democratic candidates, Hillary Clinton and Bernie Sanders, oppose TPP, even though President Barack Obama, also a Democrat, has called for its passage.

On the Republican side, Donald Trump blasted TPP in a debate on Saturday night: “It is going to be a disaster,” he said. Three days later, he won his party’s primary in New Hampshire. The winner of the Republican caucuses in Iowa, Ted Cruz, is a foe of TPP as well.

Most Americans say that trade agreements have been good for the United States: 58 percent, in a Pew Research Center survey last year. On the campaign trail, however, it would appear that protectionism is popular.

Here in New Zealand, we expect a pitched battle over TPP. As an island nation, we’re an outward-looking country. We produce high quality food, with an emphasis on ethics and environmental sustainability. My own farms focus on seed production and dairy farming on the South Island, New Zealand’s larger but less populated island.

All of us New Zealanders depend on our ability to trade with other countries—and TPP will give us better access to 800 million middle-income customers, eliminating tariffs on 93 percent of our exports.

TPP will improve our ability to buy and sell with the United States and Japan. The agreement is the equivalent of opening new storefronts in the world’s largest and third-largest economies. In addition we’re looking forward to better economic relations with Canada, Mexico, and Peru, which are also TPP signatories.

The benefits are mutual. Just as we’ll sell more to Americans and others, they’ll sell more to us. I don’t know that TPP will add many jobs to New Zealand’s economy, but it may change the jobs we do, as we constantly learn new skills, create new and more products and discover new ways to help each other.

“I think people should feel immensely proud of TPP and actually excited by the opportunity it presents,” said John Key, New Zealand’s prime minister, shortly before last week’s signing.

Yet many Kiwis are concerned about that lack of information that surrounded TPP’s negotiations. They worry that it will raise the cost of medicine and hurt the environment—and that it may even limit our sovereignty, giving foreign governments greater powers to challenge our laws and sue us.

Our current government supports TPP, but opposition parties are against it—and anything could happen.

Some countries want the United States to move first: They’re waiting to see when President Obama will submit TPP for legislative approval and whether Congress even will approve it. This year’s elections complicate everything.

Yet I believe that TPP will advance with or without the United States. If Americans decide to turn away from TPP, then the nations of the Pacific Rim may begin their own pivot to Asia, building new relationships and alliances.

By rejecting TPP, the United States would miss out on economic opportunities—but perhaps more regrettably, it would surrender its leadership position in the region.

That would be the biggest failure of all.

Craige Mackenzie

Craige Mackenzie

Farming since 1978 on 200 hectares - seed crops including wheat, ryegrass, fescue, hybrid carrots, hybrid radish, spinach and chicory; use crop sensing, soil mapping, variable rate application of fertilizer, chemicals and irrigation. Partners in a 1200 cow dairy.

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