John Roughan 's Opinion

John Roughan is an editorial writer and columnist for the New Zealand Herald.

John Roughan: Groser going for gold today

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Trade Minister Tim Groser (left), with Prime Minister John Key at Trans-Pacific Partnership talks, could be set to deliver a good deal for New Zealand this weekend. Photo / AP
Trade Minister Tim Groser (left), with Prime Minister John Key at Trans-Pacific Partnership talks, could be set to deliver a good deal for New Zealand this weekend. Photo / AP

Trade Minister Tim Groser is on the verge of a stunning achievement in Singapore this weekend. He might not say much about New Zealand's role in the Trans-Pacific Partnership negotiations, let alone his own, if the talks come to fruition in a few days. Nor should he.

The flowering of a seed planted long ago by four small free trading nations - New Zealand, Singapore, Brunei and Chile - is no doubt a credit to many diplomats besides Groser, but he must be very good.

When he was bidding to be the next director general of the World Trade Organisation this year I heard it said (not by him) that only his tenacity counted against him. The feeling was that if WTO members really wanted to revive the long dormant Doha Round they would choose Groser. If they didn't, they wouldn't.

They didn't. The new director general is a gentleman from Brazil, one of the big "emerging" economies that remain poorly governed and contributed mightily to the failure of the Doha Round.

Groser shrugged off the rejection and went back to work on the TPP, which had picked up Doha's ambitions agenda and was making more progress. Year by year the TPP has been joined by more countries on the Pacific rim, crucially the United States and, this year, Japan.

It is grappling with much more than trade barriers. It is trying to agree on intellectual property rights on the internet, parallel importing of medicines, ending agricultural protection, rights of international investors and the constitution of tribunals to hear their claims against governments.

It aims, in Groser's phrase, to be the "gold standard" certification of trade and investment. Sovereign nations will not have to sign up, and those that do can leave at any time, but those that wear the gold standard are more likely to prosper.

The rest of the world has woken up to what is happening in the Pacific. When the US joined the TPP as part of President Obama's "pivot" to Asia, Europe decided it wanted a Trans-Atlantic Trade and Investment Partnership. Those talks are suspended while Europeans get over the shock the US spies on them, but they will resume in earnest if the breakthrough comes in the TPP this weekend.

Even at the WTO in Geneva there has been a sign of life. The organisation summoned trade ministers to Bali this week to consider a draft deal on a couple of the easier issues in the Doha Round.

Global trade agreements, embracing poor countries as well as rich, are still the holy grail but the TPP is proving regional agreements can be an alternative path to the same place. There used to be closed trade blocs, mutual protection clubs like the Mercusor agreement between Brazil and Argentina, a country so miserably governed that it has been misreporting its inflation rate.

Their neighbours on the Pacific coast, Chile, Peru and Mexico are all in the TPP, an "open" treaty for all countries that can meet its standards. South Korea and Thailand want to join, so does China if the US would permit it.

The American attitude to China has given its Pacific partners greater negotiating leverage. As Groser has put it, "The ability of the US to lead the TPP initiative will answer at least some of the important questions before us about leadership in the first quarter of the 21st century."

President Obama has made trade one of his second-term priorities and he needs a success. The Congress has denied him authority to negotiate an agreement it cannot unravel, but Congress is more spooked by China than he is.

The omens are good for a deal that will strike a good balance between US business interests and the rights of global consumers. The US should get the copyright protection it seeks for movies and music. It should not get restrictions on parallel importing. Exclusive distribution channels and exploitative country pricing are not free trade.

Any changes to public purchasing systems such as Pharmac must not stop it buying generic medicines and selecting the supplier of best value.

Trade negotiations used to be afraid of failure. Not any more. Doha's failure didn't cause a general retreat to trade barriers and industry protection. Closed economies had collapsed, transnational production lines defied borders, the world had been wired for instant information, communication, capital and trade. It was a different place.

Free trade agreements are not as vital as before, and for that reason they can be better than before. New Zealand's negotiators have consistently said they will not settle for a cosmetic deal. They are going for gold.

If they keep their eye on the prize this weekend then, succeed or fail, they will deserve a parade. They have done us proud.

- NZ Herald

John Roughan

John Roughan is an editorial writer and columnist for the New Zealand Herald.

John Roughan is an editorial writer and columnist for the New Zealand Herald. A graduate of Canterbury University with a degree in history and a diploma in journalism, he started his career on the Auckland Star, travelled and worked on newspapers in Japan and Britain before returning to New Zealand where he joined the Herald in 1981. He was posted to the Parliamentary Press Gallery in 1983, took a keen interest in the economic reform programme and has been a full time commentator for the Herald since 1986. He became the paper's senior editorial writer in 1988 and has been writing a weekly column under his own name since 1996. His interests range from the economy, public policy and politics to the more serious issues of life.

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