Is the TPPA Now Fit for Purpose?

The reaction in some quarters to the outcome of the TPPA negotiations reflects a failure to understand the import of the objections made to what was initially proposed.

There will be few who will not welcome easier access to the Japanese market for New Zealand beef, even if the big prize that was dangled before us – free access to the US market for our dairy products – was taken off the agenda when Donald Trump withdrew from the talks.

The benefits of free trade for our exporters were never contested by those who were concerned at signing up for the TPPA as it was originally drafted.  If the reports coming out of the negotiations are correct (and we look forward to that being established when our new government keeps its promise to release the amended text before we sign up to it), the problems many had with the TPPA will have been substantially resolved.

Those problems revolved around the attempt to use the TPPA for purposes well beyond the normal concept of free trade.  The original draft attempted to provide a guarantee to multinational corporations that their freedom of action and their quest for profits in the countries covered by the TPPA would not be restricted by laws passed by the parliaments of the countries concerned.  Foreign corporations particularly had in their sights local laws designed to protect the environment, workers’ rights, and the health and safety of workers and citizens more generally – all of which they fear could inhibit their drive for higher profits.

As a consequence, the original draft threatened to allow challenges to anything that might interfere with the “free market” – encouraging, in other words, a free-for-all for big companies to do what they liked without any need to take account of other interests.  Anything that departed from the normal pattern, such as marketing products through co-operatives like Fonterra and Zespri, or regulating the sale of certain products such as cigarettes, or buying pharmaceuticals through an agency such as Pharmac on behalf of the whole community, could have been challenged, in a way not available to our own businesses, as contrary to the operation of the “free market”.

Any such challenge would have meant our government being taken to special international tribunals.  If those tribunals were to find in favour of the foreign corporations, they could order the government to change the law and the way we do things – even if that meant defying the will of our elected parliament and the government being forced to go back on promises made to the voters.

Little wonder that Jacinda Ardern set herself the difficult task of removing, or at least reducing the impact of, these clauses.  We will be able to judge how successful she has been when we see the full amended text.

But the early reports are that substantial progress was made on these points of difficulty, and if that is so, it is entirely because she dug in her heels.  If she was indeed able to get agreement to the necessary changes, she will have acquitted herself – at her first major international gathering – very well indeed.

She will have been helped not only by the presence of an experienced international negotiator, in Winston Peters, but also by the fact that her Trade Minister, David Parker, is one of the ablest members of her Cabinet.

But there can be little doubt that she herself made a favourable impression with her international colleagues.  Her straight talking and the energy she brings to everything she does will have helped to show that she is not just about stamping her foot, but that she is well able to build a consensus and to persuade others of her point of view.

Her opponents at home may try to downplay what she has achieved, but if we now have a “free trade” arrangement that is fit for purpose and does what it says on the packet, we can all celebrate – and that includes especially our exporters who have a trade deal they would not have had if it had not been shorn of the obvious obstacles to acceptance.  In the future, we might even be able to get, off the back of an amended TPPA, an international agreement that details the responsibilities of, and not just the concessions claimed by, those who seek to come into our country to do business.

Bryan Gould

13 November 2017