Trade update - March

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Trade update - March

25 Mar 2021 | BusinessNZ

Trade update - March

US

Eyes have been on the confirmation of and early statements from the new United States Trade Representative Katherine Tai.  Tai has been reaching out to key trade partners and the new WTO Director-General.  As with other senior representatives of the Biden administration Tai is keen to emphasise that the United States is keen to engage and be part of international processes and to work with allies.  WTO reform is a strong theme as is the need to “work constructively to address unfair trade practices of non-market economies, such as China”.  There are frequent references to a “worker-centred trade policy”.  Consideration of new agreements seem to be off the agenda while a review of the Trump administration’s trade policy is underway.  Tai did have a brief discussion with her UK counterpart Liz Truss on the US-UK FTA talks and has agreed to a further discussion in the margins of the G7 meeting.  There is no sign of any interest in a rapid reversal of the Trump tariffs or of the US seeking to join CPTPP.

WTO Reform

The 14 member Ottawa Group exploring options for reform of the WTO system met at Ministerial level on 22 March.  This resulted in yet another sleepless night for key New Zealand officials and Minister O’Connor. The meeting was noteworthy as the UK joined the group.

EU

The 10th Round of FTA negotiations with the EU has begun.  No breakthrough is expected on the difficult issues of agricultural market access into the EU and on geographical indications (GIs).  New Zealand is essentially waiting for a new market access offer from the EU before full consideration of EU requests in the difficult area of intellectual property.

With Federal election looming in Germany in September and with French Presidential Elections set for early 2022 it would be good to see a breakthrough in this negotiation in the next few weeks.  Otherwise progress could be very slow from the middle of 2021 onwards.

It is too early to tell what impact EU policies on vaccine exports might have on this negotiation.  These may have had an impact on the parallel negotiation between the EU and Australia.  This is a very hot topic in the still fraught UK-EU relationship.

It is important to be aware that COVID is still taking a heavy toll in many EU states.  Vaccination rollouts have not been rolled out as successfully as in some other jurisdictions.  Politicians and officials are very much distracted by these developments.

APEC

New Zealand is hosting APEC this year and the meeting programme is well up and running.  The first major Senior Officials Meeting (SOM) took place between February 18 and March 12.  The meeting seems to have gone well, and like everything else nowadays, was dominated by discussion on the policy response to COVID 19.  MFAT has an excellent website apec2021nz.org which contains full detail of this year’s meetings. There is an interesting video of the media conference that followed the conclusion of this meeting involving the Chair of the Senior Official process MFAT Deputy Secretary Vangelis Vitalis.

CPTPP

Media reports from the Philippines suggest that Manila has formally applied to join CPTPP.  New Zealand already has FTAs with the Philippines through AANZFTA and RCEP.  CPTPP is of a higher standard so this application is both interesting and welcome.

NZ-UK FTA

We understand that a revised market access offer from the UK is due to be handed over on 31 March.  An earlier offer was unacceptable to the New Zealand side and has seen progress in this negotiation.  We will report next month on reactions to the latest offer.

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