Robertson Grant: International Finance Agreements Amendment Bill — In CommitteeText is incorporated into the Bound VolumeRobertson Grant: International Finance Agreements Amendment Bill — In Committee[Sitting date: 10 November 2015. Volume:710;Page:7804. Text is incorporated into the Bound Volume.]GRANT ROBERTSON (Labour—Wellington Central):It is a pleasure to take a call on Part 1 of the International Finance Agreements Amendment Bill. As we discussed when the House was looking at this during the second reading it is a bill that did not generate an enormous amount of public interest when it came before the Foreign Affairs Defence and Trade Committee. In fact there was precisely no public interest when it came before the select committee but that is not to say that it is not an important piece of legislation.What I think would be useful here in Part 1 is—obviously Part 1 is the purpose clause and the purpose of this bill is to allow New Zealand to participate in the Asian Infrastructure Investment Bank. In principle that is something that on this side of the Chamber we support. There is no doubt that as the Asian region continues the enormous growth that we are seeing across it the need for infrastructure investment—the need for investment that the international community provides—only grows.The Asian Infrastructure Investment Bank arose out of the belief and I guess you could say the concern of those in the Asian region that the gap in infrastructure investment was too big to be bridged by those organisations that are currently working in the region—in particular we think here of the World Bank and the IMF. That was initially the subject of some significant concern by core stakeholders within the World Bank. There were some media reports that the United States Government and others were lobbying against countries being involved in this but we are told in the report that was provided to the select committee that other agencies like the World Bank have been closely cooperated with and collaborated with in developing the frameworks to allow this to exist and importantly that they will work together with the Asian Infrastructure Investment Bank to make sure that their projects do not cut across each other or are not in fact not working together in the best interests of the countries in the Asian region.So having got to that position it is good to acknowledge that New Zealand officials have been working alongside others to make sure that this bank has the strongest possible governance arrangements and has the best working framework to ensure the investments it makes are going to not only provide that infrastructure but also support other values that are important to New Zealanders. It is worth noting that it was New Zealand officials who worked very hard to ensure that appointments to the board of the Asian Infrastructure Investment Bank will be open transparent and merit-based that there will be a non-resident board of directors and that the appropriate environmental social and procurement safeguards will be put in place around what the bank does. That is very significant because although in principle we can say: “Yes we want this infrastructure to happen.” if there are not the right safeguards around it then we could see infrastructure investment that is less than desirable.So annex 1 of the framework document lists off the draft environment and social framework for the Asian Infrastructure Investment Bank. It is useful to note the environmental coverage is making sure there is an assessment around biodiversity impacts critical habitat impacts protected areas and climate change—the precautionary approach. All of these are really important parts of what makes for good investment. They have been secured in this agreement and from our point of view that is very important. We also have the social coverage which includes social risks impacts on the community impacts on vulnerable groups and gender-specific impacts—an important thing to note on Equal Pay Day today. It also talks about working conditions and the fact that during the implementation of operations working conditions health and safety child labour forced labour and labourrelations standards all have to be taken into account when infrastructure investment is being put in place under the Asian Infrastructure Investment Bank’s work. These are important safeguards and it is very important for New Zealand’s participation that those safeguards are there. New Zealand worked hard to ensure that the governance arrangements and the safeguards were there—that there was stability.Our actual financial contribution to the bank is modest but perhaps appropriate in terms of our relative GDP—well it has to be appropriate in terms of our relative GDP because that is how it is worked out. So we are making an initial contribution of around—well let us do US dollars because of exchange rate fluctuations shall we—US$92 million over the next 5 years. We have also committed US$369.2 million of callable capital. As my colleague Phil Goff noted in his intervention in the second reading New Zealand has never had to call on the capital that we put aside but that is the extent of the contribution that we have made. As I say although that is not a significant financial contribution it is an important stake for New Zealand to say that we are committed to this bank. We are committed to the Asian region and the opportunities that arise.The reasoning for joining the bank was threefold. Economic factors—New Zealand’s economic success is linked to the Asian region. I know that the leader of the Labour Party Andrew Little was in China last week and other Ministers from the other side of the House have visited regularly as well. No one can underestimate the extent of the development that is there and the extent to which China is continuing to invest. The Prime Minister will go with a business delegation to Viet Nam next week—there is a country where there is a need for increased infrastructure investment for it to continue to develop sustainably. It has enormous rates of growth but it is a country that could do that. We have just seen the elections this weekend in Myanmar—there is a country with an enormous infrastructure deficit that could be assisted by the work of this bank. From New Zealand’s point of view all of those are countries with which we will trade and do trade and all of those are countries that we want to see flourish in order for our region to flourish.The second reason was around connectivity to market and our ability to build on the connections that we already have in Asia. We have status within ASEAN we attend the East Asia Summit—that is where the Prime Minister is going next week—and obviously we have the free-trade agreements with China and other ASEAN members. This is a further step in New Zealand staying connected in the Asian region and connected to where we will see much of our future trade relationships.Then there is just the question of the ability to influence. If New Zealand is not there in a discussion like this we do not have the ability to do the very things that I mentioned before—making sure that the governance arrangements are sound and that the bank is working with the systems that we would want.So I will leave my contribution there. Suffice it to say that the Labour Party supports this bill. In this Part 1 of the bill there are no particular changes to deal with. In Part 2 there is one which I will take a brief call on.