National Business Review, New Zealand
Goff welcomes US FTA negotiations
By Nevil Gibson
23 September 2008
The US has reinvigorated its trade policy with the announcement it will enter into comprehensive Free Trade Agreement (FTA) negotiations to become a full partner to the Trans-Pacific Partnership (P4).
The move has been foreshadowed for some time, and its bipartisan nature was confirmed when a leading Democratic politician, Senate finance committee chairman Max Baucus, was reported by the NBR on Sept 12 as saying the US had to “re-engage” with the Asia Pacific region on trade policy.
The link with the P4 will simplify the negotiations, as it is an already existing agreement among New Zealand, Singapore, Brunei and Chile, and had first been raised with US Trade Representative Susan Schwab at a meeting in Cairns 14 months ago.
She made the announcement at a meeting of P4 trade ministers in New York earlier today (NZ time).
Speaking from New York, New Zealand Trade Minister Phil Goff said the announcement was of significant importance and would potentially increase trade by $1 billion.
“Securing an FTA negotiation with the US, the world’s largest economy, has been a key trade objective for more than a decade,” Mr Goff said. “The US is New Zealand’s second largest individual trading partner and second largest export market. New Zealand’s total trade with the US in the year to June 2008 was worth $8.14 billion, accounting for 9.6 per cent of New Zealand ’s total trade. US research conducted in 2002 into the impact of a FTA with the US showed it was of considerable benefit to both countries.
“The Trans-Pacific Partnership [P4] is widely viewed as a model free trade agreement. This [Asia Pacific] region represents nearly 60 per cent of global GDP and roughly 50 per cent of all international trade. It is a key driver of global economic growth.
“With the involvement of the US , the Trans Pacific Partnership is now poised to expand rapidly to encompass other countries in the region and to lead to greater economic integration in the Asia Pacific,” Mr Goff said.
He said interest in the agreement had been shown by other countries such as Peru, Vietnam and Australia.
“Eventually we hope the agreement will prove attractive to other large economies in the region such as Japan.”