Sutton pushing for trade deal

By FRAN O'SULLIVAN

WASHINGTON - New Zealand's opening bid for a free trade agreement with the United States has been boosted by the introduction of a bill last week which urges President Bush to initiate US talks on a regional deal with Singapore, New Zealand and Australia.

Singapore and Australia had earlier broken off discussions on a regional deal to push their individual cases, leaving New Zealand out in the cold.

But the Bush Administration still has considerable ground to cover before any free trade agreement, whether bilateral or regional, can be negotiated.

Trade Minister Jim Sutton opens his face-to-face campaign today with an outright pitch to Democrat hardliner Cal Dooley.

Mr Dooley, co-chair of the New Democratic Coalition and a member of the House agricultural committee, is first up in an influential list of politicians and trade players whom Mr Sutton is wooing with a "ready when you are" message during two days of intensive lobbying.

Mr Dooley is a pivotal figure in the discussions that the Bush Administration is now having with Congress on the resumption of the Trade Promotion Authority Bill.

This authority would give the President's trade officials the ability to negotiate trade agreements which cannot be subsequently changed by the Congress, just voted up or down.

But US Trade Representative Bob Zoellick has considerable lobbying of his own to do before he gets sufficient numbers in Congress to pass a fast-track bill. Democrats led by Mr Dooley have argued they will want to see trade sanctions included in a list of possible options for enforcing trade agreements before they support trade liberalisation.

But making trade sanctions one possible option does not mean they would have to be used in a trade deal.

Mr Sutton said New Zealand had displayed leadership in the free trade area through its negotiation of a CER deal with Australia, and subsequent deals with Singapore and Hong Kong.

Mr Sutton indicated a willingness to resume joint discussions with Australia on a regional deal with the US, instead of each country pursuing its own agenda.

Any trade deal would have to include the sensitive area of agriculture, but Mr Sutton said last night that New Zealand's position was flexible. It had only 2 per cent of the market for internationally traded dairy products and was not in a position to flood the market.

In the year ended December 2000, New Zealand's exports to the US were worth $4.1 billion, up 32 per cent on the previous year.

The low New Zealand dollar played a large part in the boost and while commodities still dominate, the structure is changing with manufactured goods - such as yacht, motor vehicle parts, medical instruments, iron and steel - now accounting for just over 20 per cent of the total.

But the balance is heavily tilted in the US favour with imports totalling $5.3 billion for the December year, up 17 per cent.

Later today Mr Sutton will meet US business representatives.

He will sign the multilateral aviation services agreement in Washington tomorrow.