Mexico pushes for trade deal with NZ

Todd McClay says TPP will also be on the agenda for his talks in Mexico. Photo / Ben Fraser

Trade Minister Todd McClay will request that talks on a Mexican free trade deal be placed on the agenda when he meets his counterpart in Mexico in 10 days time.

McClay - who departs tomorrow for a trip to Australia, Japan and Singapore before flying on to Mexico - was yesterday upbeat about the clear signal from Mexican president Enrique Pena Nieto that he wants to forge bilateral deals with New Zealand and other signatories to the Trans-Pacific Partnership (TPP).

The Trade Minister says TPP will also be on the agenda for his talks in Mexico, as will the potential for New Zealand to join the Pacific Alliance. The Alliance is a regional trade grouping including Chile, Colombia, Mexico and Peru - all countries which border the Pacific Ocean.

McClay is visiting the the TPP signatory nations in New Zealand's capacity as the depositary for the Asia-Pacific deal, to see what elements can be preserved.

Pena Nieto's decision to pursue bilateral deals with TPP signatories came in the wake of US President Donald Trump's decision to collapse the agreement.

It is another indication that the signatories are not going to stand by and let Trump waste eight years of hard negotiations among the TPP parties to get commonality on major issues affecting Asia-Pacific trade.

Not only is New Zealand on the Mexican President's dance card, but also Australia, Brunei, Malaysia, New Zealand, Singapore and Vietnam.

"The President has already instructed me to convert the Transpacific Association Agreement (TPP) into bilateral agreements with all the countries with which we do not have free trade agreements," Ildefonso Guajardo, Mexico's Secretary of Economy told the Financial Times.

In an email, the Mexican Ambassador to New Zealand, Jose Gerardo Traslosherosare, said "we are happy to share with you that the Mexican government has decided to launch bilateral FTA negotiations with a number of TPP countries, and this includes New Zealand."

The ambassador later told the Herald he was looking forward to Mexico and New Zealand moving forward. "TPP was a wonderful advancement. We will sit down and look at the possibilities and the sensitivities [with the bilateral deal]."

The FT reported officials confirmed that the Mexican presidential order to seek bilateral deals came at a meeting with businessmen of the American Chamber of Commerce (Amcham) in Washington, DC. "I have been working for four years to diversify and open the trade bridges I have with other countries," Guajardo reportedly told Amcham's businessmen.

The FT reports that one of the most sensitive sectors for Mexico is agriculture, since Australia and New Zealand occupy important positions in the international trade of several raw materials, especially dairy products.

In the TPP, for example, Mexico undertook to gradually open quotas on the importation of dairy products and palm oil, to reach 60,625 tonnes per year from year 11 of the agreement entering into force.

Mexico has opportunities to increase its exports of manufactured goods to the TPP nations - particularly motor vehicles.

The TPP is made up of Australia, Brunei, Canada, Chile, the United States, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

The ambassador stressed to the Herald that while the Nafta deal is to be renegotiated at Trump's request, that presents an opportunity to "modernise the agreement" between the US, Canada and Mexico.

"It is in everyone's interest to maintain and improve what has been a very productive relation between Mexico and the US regarding not only trade, but also immigration and security issues," said Traslosherosare .