Goff Phil: International Finance Agreements Amendment Bill — In CommitteeText is incorporated into the Bound VolumeGoff Phil: International Finance Agreements Amendment Bill — In Committee[Sitting date: 10 November 2015. Volume:710;Page:7814. Text is incorporated into the Bound Volume.]Hon PHIL GOFF (Labour—Mt Roskill): Part 2 of the International Finance Agreements Amendment Bill is about the membership of the infrastructure bank. It makes the substantive changes that enable New Zealand to become a member of the Asian Infrastructure Investment Bank. Again I would like to talk about why we should become a member of the bank and why we are supporting this.In that respect just to touch on some of the comments made by my friend and colleague from the New Zealand First Party about whether this brings in only intangible benefits I think Fletcher Tabuteau drew on the analogy that China would have traded with us anyway so we therefore did not need to have a free-trade agreement with China. Well I am sorry; that is absolutely wrong. I know that New Zealand First opposed that agreement at the time. But it was not about intangible benefits; it was about very tangible things in terms of removing the tariffs. Actually making it tariff-free meant that you could increase your trade. Also—and maybe not quite as objective but certainly as strong a factor—there was the profile that it gave us. China always talked about the four firsts. That was in reflection of the relationship that we had with that country. That is why our exports went from $2 billion a year to over $10 billion a year.It is the same thing for this agreement. What would have happened—or what would happen—if New Zealand was the only substantial country in the Asia-Pacific region that did not participate in this bank? What message would we be sending to our colleagues in the ASEAN region? The message we would be sending is that we did not care about their infrastructure needs we were not really part of their region and we did not have an interest in helping them with either the technical assistance this bank will give or with the infrastructure investment assistance. Next time we went along to one of those countries and said to it “OK we’d really like to develop this relationship. We’d like more students we’d like more tourism we’d like to trade more with you.” it would scratch their heads and ask whether this is a country that is really committed to its region. It might still buy our products but it would be less inclined to regard us favourably and to give us the benefit of the doubt at times when a relationship really demands that we need the benefit of the doubt. So I think you cannot simply dismiss our involvement and our commitment to the Asian Infrastructure Investment Bank as being something that is simply an intangible benefit.The fact of the matter is that the greatest tangible benefit is that if we invest in this bank along with other countries that are giving the bank much more capital we will help the development of those countries. They will develop their middle class and their taste for New Zealand products and they will buy more products off us. To consider that New Zealand is an isolated island and can act without regard to the global environment within which we participate is a wrong view and I believe a naive view.What are the tangible benefits then of becoming a member of the bank which is what this part of the bill is about. First of all it is about increased economic development in the Asia region and the flow-on benefits that that will bring. Every study that has been done including by other development banks like the World Bank and the International Monetary Fund has said that there is a huge lack of capital for investment in infrastructure and that that is holding the region back. If they can get that capital if they can develop that makes the whole region better off it makes it more stable it makes it more prosperous and New Zealand benefits.Secondly it is in support of increased integration of the region. When we did the international treaty examination at the Foreign Affairs Defence and Trade Committee that was a key point made by officials reporting to us on our national interests as to why we would benefit from participation in and membership of the bank. It also augments our existing relationships in the region. For years speaking as foreign affairs Minister and trade Minister we were actively involved in the region at ASEAN regional forums at APEC meetings and so on. It is critically important. The majority of our trade flows now not to Europe but to the Asian region. [Bell rung]