NZ to set up trade post in Fiji – but questions are raised about the confines of the “Pacific region”

Great – a statement from Damien O’Connor that won’t (or shouldn’t) frighten the horses or our allies. At least, not in terms of signalling a greater fondness for China  than for friends in the democratic West.   

It was a trade statement:  New Zealand will open a new Trade Commission in Fiji later this year, O’Connor announced as Minister of Trade and Export Growth. 

But his next sentence might have raised some eyebrows. 

“Fiji is New Zealand’s largest trading partner in the Pacific region”, Damien O’Connor said.

Really?

Some definition of terms was called for here.  

Some people would define the Pacific region to include the United States, China and Australia.

We imagine O’Connor was defining it to embrace only the island countries of the South Pacific (but referring to Pacific Islands Forum countries, let’s say. would oblige him to include Australia).

The announcement was one of three to emerge from the Beehive since the last time we checked.

The others were –

  • Cabinet has finalised a package of new measures to protect New Zealanders’ interests in the banking and financial system, including guaranteeing deposits of up to $100,000 per eligible institution.
  • Tertiary Education Commission data for enrollments in tertiary and vocational study as at December 2020 shows the number of apprentices increased by 17.6 per cent compared to 2019 (45,155 in 2019 and 57,035 in 2020). 

In his news about the new trade commission, O’Connor said that before the COVID-19 pandemic, annual two-way trade between New Zealand and Fiji was worth more than $1.1 billion.

The new Trade Commission office in Suva will be responsible for helping grow New Zealand business in Fiji “across the broader Pacific region”.  This presumably does not mean countries such as Australia, the US or China.  

“Boosting the more than $3 billion in annual trade and investment flows between New Zealand and the Pacific will be critical for all economies in the region as we work to recover from the devastating economic effects of COVID-19.

“This aligns with the Government’s commitment to renew and recharge our partnerships in the Pacific to support the region’s security and prosperity.”

Once the formal diplomatic approvals have been worked through with the Fiji Government, New Zealand Trade and Enterprise intends to recruit the new Trade Commissioner with an expectation the successful applicant will begin work in Suva later this year.

Finance Minister Grant Robertson said the measures to protect our interests in the banking and financial system are the final part of a comprehensive review of the Reserve Bank of New Zealand Act.

They will help protect New Zealand’s financial system and wider economy from damage that could be caused by excessive risk taking by the deposit taking sector and any resulting failures of institutions, Robertson said.

The government originally proposed a $50,000 limit for deposit protection but after listening to feedback this has been increased to $100,000. 

“This will fully protect 93 percent of depositors.”

When enacted, the measures will ensure individuals have up to $100,000 of their deposits in any eligible institution guaranteed in the event of the failure of an institution.

”As well as instituting the deposit guarantee scheme, the measures we have confirmed today will improve regulation and supervision of deposit takers and strengthen New Zealand’s financial crisis framework.”

No great urgency is being attached to this.  The Bill is expected to be introduced to Parliament towards the end of the year and the aim is to have deposit insurance up and running in 2023. 

The reforms will include a new process for setting lending restrictions, such as loan-to-value ratios.

“This will give the Minister of Finance a role in determining which types of lending the Reserve Bank is able to directly restrict. The Reserve Bank will then have full discretion to decide which instrument is best suited to use and how the restrictions are applied,” Grant Robertson said.

As with other prudential requirements, lending standards policies will be subject to more general requirements such as consultation with other government agencies and the public, and the Reserve Bank needing to have regard to the Minister of Finance’s Financial Policy Remit.

The apprenticeship statistics enabled Education Minister Chris Hipkins to remind us the Government has backed the trades with more than $320 million invested in free trades training (TTAF), and nearly $100 million going to support employers retain apprentices and take on new ones through Apprenticeship Boost.

The number of Māori and Pacific apprentices grew almost 30 per cent last year and the number of women training to be apprentices is growing at nearly twice the rate of male apprentices.

Latest from the Beehive

22 APRIL 2021

Deposit taking measures protect financial stability and New Zealanders

Apprenticeship numbers jump in 2020

21 APRIL 2021

New Zealand to open new Trade Commission in Fiji

 

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.