Among the many issues related to the performance of the export sector and how the Government might further help it is the case for negotiating a trade deal with India.
Australia has secured a free trade deal with what is the planet’s fifth-biggest economy.
In contrast, Agriculture and Trade Minister Damien O’Connor says concluding a free trade agreement between NZ and India “is not a realistic short-term prospect”.
Intensive negotiations were held between India and NZ in the context of the Regional Comprehensive Economic Partnership FTA negotiations, especially in 2018 and 2019, before India withdrew from the RCEP negotiations in November 2019.
“RCEP contains provisions enabling expedited accession by India should it wish to re-join RCEP at some point in the future, says O’Connor.
In the meantime NZ and India continued to work together to strengthen their broader bilateral relationship, he says.
If the delegates at a conference of nurses yesterday serve as a guide, when it comes to our telling them what ails us and describing the symptoms, we should worry about how many cannot comprehend English and how many prefer to communicate in te reo.
A mixed bag of news came down the line for New Zealand’s dairy industry over the past week. On one side, Fonterra trimmed its forecast payout for the season, while on another a2 Milk surprised its critics by reporting a 42% jump in net profit to $114m.
Any company listed on the NZX and sitting on a cash mountain of $800m must be doing something right. Yet some of the headlines on its result focussed on what might go wrong for the company that specialises in marketing a2 milk and infant formula.
For example Business Desk’s Jenny Ruth says the biggest source of uncertainty for a2 Milk right now is China’s State Administration for Market Regulation (SAMR) deadline of February 21, 2023, for companies selling infant formula in China to get a new form of approval. It’s called the GB standard, which is a Chinese national standard. Foreign companies won’t be able to manufacture formula for the Chinese market beyond that date unless they meet the new standard and have that all-important tick from SAMR.
It’s a tense time in New Zealand’s farming industries. Already the Ministry for Primary Industries has had to shoot down an overseas news report that China had shut its borders to NZ and Australian products due to concerns about foot-and-mouth.
NZ exports to China are continuing as normal, a Ministry for Primary Industries spokesman said.
And Fonterra’s fortnightly GDT auction went ahead as scheduled this week, with keen bidding by Chinese buyers.
Trade Minister Damien O’Connor addressed the China Business Summit, Foreign Minister Nanaia Mahuta departed for the Indo-Pacific region for a programme of talks on security and economic issues, and the PM announced the launch of a new climate change partnership with Samoa and confirmed support for the rebuild of the capital’s main market.
The PM’s announcements were accompanied by $15 million to support Samoa’s response to climate change and $12 million toward the rebuild of the Savalalo Market in Apia
Ministers with a domestic focus meanwhile were getting on with telling us about their legislative and regulatory agendas and other programmes.
A major item was the launch today of New Zealand’s first National Adaptation Plan, designed to ensure communities have the information and support they need to prepare for the impacts of climate change.
The Minister of Social Development and Employment told us in our previous Buzz bulletin about a new report which shows Government support has lifted incomes for Beneficiaries by 40 percent over and above inflation since 2018.
But the government doesn’t limit its redistribution of our taxes to dishing out money to beneficiaries. The PM and her Revenue Minister accordingly popped up yesterday to enthuse that from 1 August – today – an estimated 2.1 million New Zealanders will be eligible to receive the first targeted Cost of Living Payment.
The recipients will receive an extra $116 per month eac for three months.
“Nothing like a trip abroad to put a spring in the PM’s step” – or so said the sub-heading on a report in the NZ Herald on Saturday of Jacinda Ardern’s visit to the United States, a visit which by most accounts was successful in its primary aim of reviving contacts with both political and business leaders.
Political editor Claire Trevett put it aptly:
“NZ was looking for new growth in its relationship with the US after the pause of the Trump era”.
New Zealanders, too, were chuffed at the success of the PM’s mission, her popularity with the Americans she met, and especially her chat with President Joe Biden. The applause she won for her address at Harvard University in itself was remarkable, and probably stimulated Trevett to note that:
“The Ardern in the US was a stark contrast to the Ardern we have seen in New Zealand in recent months”.
National’s Gerry Brownlee had a free hit on Foreign Affairs Minister Nanaia Mahuta, whom he sees as missing in action as China makes its moves to become a dominant power in the Pacific. These moves – potentially – pose a security threat to Australia and New Zealand.
While foreign affairs experts are expressing alarm and calling on the government to urgently repair NZ’s run-down defences, specifically equipping our army with missiles and drones, there is silence from both Mahuta and Defence Minister Peeni Henare.
Brownlie says Mahuta
“….needs to front up and explain what she’ll be doing to salvage New Zealand’s relationship with the Pacific.
Not many New Zealanders may have noticed what is happening in China or India – but their economies appear to be tracking in opposite directions. Those movements could have a powerful impact in turn on NZ’s economic fortunes.
Point of Order is indebted to two remarkable pieces of journalism for insights that give context to these issues. One report appeared in the Guardian Weekly, the other in The Economist.
The first, by Larry Elliott, was headed “Stifled dragon: No-one should take delight in Beijing’s economic woes” and argues a full-blown economic crash would be as damaging to the world as the US sub-prime mortgage crisis was.
The report in The Economist focused on India’s economy which, it said, is likely to be the world’s fastest-growing big economy this year. The details prompted The Economist to editorialise that the Indian economy is being rewired.
“The opportunity is immense— and so are the stakes”.
The question for NZ exporters, who have become dangerously dependent on the Chinese market is whether they should now be exploring prospects on the Indian sub-continent.
Larry Elliott wrote that China has been central to the story of globalisation over the past 30 years, but now it is struggling.
The news from the Beehive has been mixed on the trade front – greater trade liberalisation with China was welcomed by Trade Minister Damien O’Connor but was countered by his announcement (alongside Foreign Minister Nanaia Mahuta) of significant new sanctions against Russia.
It’s a good thing our trade with China is much greater than our trade with Russia.
But the government’s general inclination to regulate rather than liberalise is reflected in its signalling a Nanny State crackdown on what our kids can drink.
It has opened a public consultation on a proposal for primary schools to offer only “healthy” drinks. We trust they know what they are doing with this one.
We say this because alcoholic drinks are good for our health, according to some websites checked out by Point of Order. Consumption must be moderate, true, but that should apply to whatever our kids eat and drink.