Jacinda Ardern talks up trade and economic policy on return to work

Prime Minister Jacinda Ardern, with Trade Minister David Parker, during her post Cabinet press conference at the Beehive. Photo / Mark Mitchell

Prime Minister Jacinda Ardern marked her return to public life by formally launching a national consultation process intended to improve public support for the pursuit of new international trade agreements and tackling head-on the mounting political fallout of declining business confidence.

Flanked by International Trade Minister David Parker, Ardern announced the year-long 'Trade for All: have your say' consultation at her first post-Cabinet press conference since taking leave to give birth to her first child six weeks ago. The trade policy consultation, to be led by a newly created Trade For All advisory board, was signed off by the Cabinet Economic Development Committee six weeks ago, on June 27.

"We said after the negotiations for the CPTPP that we were determined to avoid a future backlash against globalisation while delivering improvements in employment, in incomes, and trade is a key driver in that," said Ardern, referring to one of her government's first acts after being formed last October: completing negotiations for the controversial Pacific Rim trade pact now known as the Comprehensive and Progressive Trans-Pacific Partnership.

"Trade policy is obviously integral to our work to support businesses and exporters as we modernise our economy to be sustainable, but also to be inclusive."

Borrowing the tag-line 'Trade For All' from a similar initiative conducted by the European Union, the announcement allowed Ardern to set a pro-business economic agenda at a time when declining levels of business confidence have become a major political issue, especially as trade policy has so far provided some of her administration's best opportunities to demonstrate mainstream economic policy credentials.

Heading the advisory board will be retired former diplomat David Pine, who served as head of mission in both Malaysia and the Philippines among a string of international postings during his 21 years with the Ministry of Foreign Affairs and Trade, although Kiwi music afficionados may recall him better as a guitarist and vocalist in one of the Flying Nun Records stable of indie bands, Sneaky Feelings.

Asked whether there would be room for critics on the advisory board such as Auckland University law professor Jane Kelsey, one of the country's fiercest critics of free trade agreements, Pine said: "Yes. The Prime Minister made the point that a significant group of New Zealanders have lost confidence. We've got to hear them. We've got to really understand what their concerns are and there's no point in the process if it doesn't engage with people who are critical."

Public submissions will be sought by the end of next month for development of policy recommendations by April next year and recommendations to Cabinet in June 2019.

Issues singled out for consultation include environmental issues, labour rights, gender equity, the rights of indigenous people, protecting traditional knowledge, and "preserving the right of governments to regulate in the public interest, including for national land markets, taxation of multinational business, and public services".

However, free trade negotiations already under way would continue in the meantime.

"It is not feasible to 'pause' negotiations" while the consultation process occurs, the Cabinet paper says. "Nevertheless, officials will seek to incorporate insights and findings from Trade for All in individual negotiating mandates."

Forthcoming FTA negotiations with the EU "will be a particular opportunity to explore progressive and inclusive approaches, given the commonality of views between our respective trade agencies".

Also talking up the government's economic policy this week will be Finance Minister Grant Robertson, who Ardern said will deliver a speech in Auckland on Wednesday outlining the government's agenda to move away from "the settings of the past", which relied unduly on population growth through immigration and real estate speculation to fuel growth.
Trade was important to that agenda because export firms were around one-third more productive than non-exporting firms, she said.

On slumping business confidence, Ardern said: "We need to look at the indicators around the health of the economy as a whole", including low unemployment, strong economic growth rates, low government debt, Budget surpluses, and the boost to household incomes flowing from the July 1 Families Package.

However, the government was not tempted to relax its Budget Responsibility Rules targeting net Crown debt at 20 percent of gross domestic product to boost growth.

"The business community would say that their confidence in us is based on our ability to balance the books and deliver a strong economic agenda and delivery a surplus and low debt," she said.