TPP troubles no cause for celebration says minister

There is not a single thing about the US not signing the TPP that is good news for NZ, says Trade Minister Todd McClay, seen here at the signing of the deal at SkyCity last February. Photo / Nick Reed

Trade Minister Todd McClay says TPP opponents should not be celebrating Donald Trump's directive to withdraw the United States from the 12-country trade agreement.

"America not signing TPP is not good news for New Zealand. There is not a single thing about that that is good news for New Zealand," he told the Herald.

And despite Japan saying it was going to try to persuade the United States to change its mind, McClay told the Herald he did not think it would change its mind.

President Donald Trump has signed a directive to withdraw the US from the deal and for officials to being bilateral negotiations where possible with parties - which includes New Zealand.

The remaining 11 countries will need to decide whether to continue without the United States.

Japan Prime Minister Shinzo Abe visiting Australia last week described the TPP as "indispensable" but his spokesman this week said it would try to persuade the US to remain in it.

McClay did not believe that would bear results.

"I don't think America is persuadable on TPP at the moment."

McClay said TPP negotiators would meet in the next week or two. He would be meeting several of his TPP counterparts in the coming weeks ahead of a trade ministers meeting in March by which time, they would be better prepared to come to a position.

"We don't need to panic because it is a process that has been underway for quite some period of time."

He said the developments of the TPP were no cause for celebration.

"I don't think the advent of greater protectionism in the world's largest economy is something to celebrate in New Zealand.

"We are a small country a long way from everywhere else and when it is more difficult for New Zealanders to trade, we end up having a weaker economy, a lower quality of life and standard of living here."

But Greens MP Barry Coates told reporters the debate around TPP was "a desperate search for FTAs as if they are the answer to economic growth and growth of our exports."

The TPP was no magic bullet and would have delivered only 0.9 per cent of GNP in 30 years' time.

"It has almost taken on a Holy Grail aspect that by signing FTAs, we will suddenly become an economy that can trade with other countries."

His preference would be for any future trade agreements to be about market access and tariff reduction only, not provisions such as dispute procedures for foreign investors and constraints on Governments to regulate.

Auckland University law professor Jane Kelsey said the current trade model was in crisis and it was prompting discussion on alternatives.

"It is a contest of ideas that will start to make the unthinkable possible and we will have lots of arguments and we need to have those arguments in this country as well as in others."

It linked back to what sort of domestic economy New Zealand should have in the next 40 or 50 years that wasn't simply about exports of dairy.