Some Ministers head overseas while others are aiming for the stars (giving their strategy its thrust with a $16m investment)

Buzz from the Beehive

The news from the Beehive featured announcements of ministerial travel plans and law-and order initiatives along with news that our government is aiming for the stars with a strategy given some thrust with almost $16 million of public funding.

New ministerial posts also deal with:-

The monitoring of marine reserves –

A new monitoring programme for marine reserves, coupled with a network of marine reserve rangers, will boost protection for the country’s special marine areas.

Congratulating Britain’s new PM – 

Prime Minister Jacinda Ardern has congratulated Liz Truss on her election as Conservative Party leader, and pending appointment as Prime Minister of the United Kingdom.

The new Aerospace Strategy – which has been opened for public consultation – will be supercharged with

• $9 million for research partnerships with NASA
• $3 million for research projects under the Government’s Airspace Integration Trials Programme
• 3.7 million for the Civil Aviation Authority to establish an Emerging Technologies Programme, which will help the CAA to increase its regulatory capacity.

The strategy was announced at the inaugural New Zealand Aerospace Summit in Christchurch.

Lower the drawbridge – the PM is planning to bust out of the NZ bubble to talk trade (among other things) in Europe

PM Jacinda Ardern is planning a major visit to Europe next month. Details have yet to be announced but she is expected to visit Paris, Brussels and possibly Berlin.

She is heading NZ’s campaign to secure a free trade agreement with the European Union. First visit is likely to be Paris where she will have a warm welcome from President Emmanuel Macron. This couldn’t come at a more appropriate time.

The French are feeling bruised over the Australia-UK-US nuclear submarine agreement and the cancellation of the $80 billion contract to build French nuclear submarines converted to diesel-electric power in Adelaide. France has already signalled it would not impede a NZ-EU trade pact.

European countries generally are concerned at the new nuclear submarine pact.  EU capitals had no prior warning despite President Joe Biden’s expressed desires to repair relations bruised under Donald Trump.  It was also angered by Biden’s failure to alert Europe of his withdrawal from Afghanistan despite the presence of European forces in that country.

PM brings news of partnerships with Spain (for global strategic reasons) and the Sallies (to provide housing on the home front)

The PM has announced one partnership – a strategic partnership between the governments of New Zealand and Spain – and welcomed the fruits of another, a partnership with the Salvation Army to deliver public housing.

Our attention was drawn more to the strategic partnership with Spain, because that country doesn’t normally command much attention Down Under.

Indeed, it’s a measure of Spain’s importance that the trade statistics – should you check them out on the Ministry for Foreign Affairs and Trade website – are dated  2014.

The total trade in goods between the two countries at that time was $723 million.

It was an imbalanced trading relationship – our exports to Spain were worth $170 million (although these did not include New Zealand goods such as kiwifruit that might have been shipped to Spain from another country).

We imported Spanish goods worth $553m.

The other partnership mentioned by the PM, with the Sallies, has just delivered 68 new public housing places for Aucklanders and their families.

Brexit: concerns about reduced economic openness and lessons from NZ’s terms of trade

LONDON CORRESPONDENT:  The UK’s central bank, the Bank of England, last Wednesday published a series of gloomy Brexit scenarios.  Supporters of Britain’s departure from the EU erupted in fury – but accusations of bias and bad faith miss the point. While civil servants do their utmost to avoid telling lies, ignoring, obscuring and arguing from carefully selected premises are part of the stock-in-trade.  Behind the politically chosen scenarios, the analysis is revealing and helpful to reasoned argument from all camps.

The scenarios modelled run from close economic partnerships (a version of which is currently before Britain’s parliament), through transition to World Trade Organisation trade terms, and on to a no-deal/no-transition ‘hard Brexit‘.  All of them suggest that the UK’s economy would be smaller over time than if the UK had remained in the EU, up to 10% smaller in the most dire, disorderly Brexit scenario.

The basis of the bank’s modelling (affirmed throughout the report’s 86 pages) is the assumption that all of the scenarios lead to a less open, and thus less productive, UK economy.   The economic literature is abundantly clear that openness to trade in goods and services and to foreign investment, facilitates competition, innovation and specialisation, and thus productivity.  QED one might say.

How a relaxing of the EU’s ‘four freedoms’ principle could hasten a Brexit deal

LONDON CORRESPONDENT:  Having spent the summer suggesting the British government’s Brexit proposal is a non-starter, the European Union now says a deal could be reached in six to eight weeks.  What on earth has changed?

Rewind a moment.  In July, in the so-called Chequers plan, the British suggested the UK could continue to follow the EU’s rules for goods and agricultural products after leaving the EU – effectively remaining in the single market for these items. Britain would avoid trade disruption; Europe would retain a protected market.

The EU’s unhappiness with this reflected a philosophical principle – that you can’t pick and choose from the EU’s four freedoms (free movement of goods, capital, services and people).

Brexit opportunity: just don’t call it another free trade agreement

LONDON CORRESPONDENT: Does New Zealand’s government understand the opportunity which Brexit presents? Are they and their advisers working tirelessly to realise it?

OK, difficult questions, not least because there are no binding decisions on the shape or timing of Brexit and these are likely to come in a final rush. But the underlying position is so positive that it would be a tremendous shame if New Zealand’s policy was not being shaped to take advantage of it.

Given the scorn critics are pouring on Britain’s post-Brexit trade prospects, the UK really needs an eye-catching trade deal to kick in on leaving. It would be a political coup, more than an economic one. The partner which Britain’s politicians think will deliver this reliably and quickly should get the most attention and the best terms.

Why Brexit will be well down among EU summit concerns (except for the British)

LONDON CORRESPONDENT:  As Europe drifts into a hot and torpid summer, there are signs that politics are not what they used to be.  Events are harder to manage when the balance of opinions underlying political formulae change and rising forces must be accommodated. Nowhere more so in dealing with migration – or the underlying questions of identity and society which it poses.

A New Zealander going to Europe after a long absence cannot fail to notice how different the streets of the cities look.  But the numbers show that there is a strong case to be made for the capability of modern societies to assimilate large numbers with great speed and success.

The accompanying political correctness can be tiresome and, to some, offensive.  The indigenous minorities which feel they have been crowded out have so far been safely ignored (a recent documentary on an obscure London regional TV channel was entitled ‘Last Whites of the East End‘).