Even more surprisingly, the clincher came down to action by the Labour Government. Apparently Japan and New Zealand took a tag team approach to twisting Canada’s arm with a good cop, bad cop routine. Pressure was also put on Canada with the knowledge Mexico wanted the deal done and Canada wants Mexico’s support in North American Free Trade Agreement talks with the United States.
And it is the recent statements and actions coming out of America that make the CPTPP important for small, vulnerable countries like New Zealand. Korea being a close military ally of the US didn’t stop President Donald Trump slapping import tariffs of 50% and 30% on South Korean washing machines and solar panels. Trump has also taken his America First message to the meeting of global economy leaders in Davos, Switzerland.
With Trump’s message of do it his way or hit the highway any new deals New Zealand can do with US customers are more likely than not to be on terms favourable to the US. That makes guaranteed access to other markets on stable, guaranteed terms important. It means our exporters have options.
There has been much talk in recent times of increasingly isolationist and protectionist trade policies but as well as CPTPP both the Europeans and British had been talking free trade and expressing a desire for more agreements. China, too, has been open to increasing trade and has been promoting its own multi-nation free-trade agreement. So while Trump is talking tough in the knowledge the US has the clout to back up his threats the response is increasingly for those feeling threathened to gang up against him with their own arrangements. He might well find himself the odd man out, even in Nafta talks if Mexico and Canada can find common ground. That can only be good for nations like New Zealand.
