New Zealand ratifies TPP trade pact
By Michelle Russell | 12 May 2017
New Zealand has become the second country, after Japan, to ratify the Trans-Pacific Partnership (TPP) trade pact following the US's decision to pull out from the deal.
Trade Minister Todd McClay said yesterday (11 May) the move by New Zealand's Cabinet shows "leadership" with Japan and "sends a clear message that we see value in a common set of high-quality rules across the Asia-Pacific" and that the country is keeping all of its options open.
"TPP remains valuable both economically and strategically. It stands to improve access for New Zealand exporters and lower tariffs around the Asia-Pacific, including Japan, the world's third largest economy," McClay said.
Ratification comes ahead of the APEC Trade Minister's meeting in Vietnam later this month where McClay will co-chair a separate meeting of TPP Ministers.
"Following the US withdrawal from TPP, our export sector and business community sent a clear message to find a way forward for this valuable agreement and that's what we have been working hard to do," McClay added. "We are still actively exploring alternative options for TPP and expect other TPP partners to also ratify in the coming months.
"There is a building consensus that a common set of high quality rules across the Asia-Pacific will greatly benefit regional economic integration and support openness. High-quality trade deals are a key driver of growth, competition, innovation and productivity that create jobs and lower costs for consumers."
US president Donald Trump signing an executive order in January to withdraw from the TPP, fulfilling one of his campaign pledges.
The proposed free trade deal with 11 other Pacific Rim nations including the US, Japan, Vietnam, Malaysia, Australia, Canada and Mexico was agreed in 2015 but had not been ratified by the individual countries.
The pact, which would have linked 40% of the global economy, or $28.1 trillion worth of GDP, was described as a "disaster" by the new president during his election campaign, claiming it would threaten American jobs by introducing lower-wage competition.
Since Trump left the TPP, China has started presenting itself as the great hope of international free trade deals. It is promoting the Regional Comprehensive Economic Partnership (RCEP): a bit like the TPP, without the US, but with India, China, Korea and more SE Asian countries.