Genter Julie Anne: International Finance Agreements Amendment Bill — First ReadingText is incorporated into the Bound VolumeGenter Julie Anne: International Finance Agreements Amendment Bill — First Reading[Sitting date: 15 September 2015. Volume:708;Page:6603. Text is incorporated into the Bound Volume.]JULIE ANNE GENTER (Green): The Green Party will be supporting this bill at its first reading. The bill of course puts into effect the Government’s commitment to make a contribution to the Asian Infrastructure Investment Bank which is an initiative of China in particular but it has 57 countries signed up to it to be a multilateral investment vehicle that will enable investment in core infrastructure and also in areas of potentially productive industries across Asia and the Pacific.There is no question that investment in infrastructure across the world will be necessary to respond to both of the big global challenges that we are facing: that is climate change and inequality. When it comes to climate change there is the potential for infrastructure to reduce pollution and also to help us to adapt to the climate change that is already locked in like sea-level rise and increased frequency and severity of storms. It is really critical that we are investing in the right type of infrastructure to address these problems. It remains to be seen whether or not the Asian Infrastructure Investment Bank will be leading on that type of investment.The Global Commission on the Economy and Climate put out a report earlier this year called The New Climate Economy. It had a specific focus on infrastructure. What the report says is: “2015 is a year of unprecedented opportunity. A goal once seen as distant—to end extreme poverty achieve broad-based prosperity and secure a safe climate all together—is increasingly within reach.” And that is exactly what the Green Party is interested in. We must respond to climate change. We must reduce greenhouse pollution—there is no debate about that. To that end every piece of infrastructure that we are investing in needs to bring us closer to that goal.What is increasingly being said by economists across the world is that there is no trade-off between reducing our greenhouse pollution and having an economy that works for people. There is not a big financial cost to reducing our emissions—in fact there will be an enormous financial cost and consequences to not reducing greenhouse pollution—so that is why climate change in particular is a major priority for the Green Party. We have high hopes that the Asian Infrastructure Investment Bank will be investing in infrastructure that not only enables reliable access to electricity clean water sanitation facilities transport and urban development but does all of this with an eye to reducing greenhouse pollution and achieving greater equality across the world because ultimately that is going to be better for the economy.There is a slight risk right? This is because investment in all of these areas of infrastructure whether it is electricity generation transport water sanitation—all of that has the potential to reduce pollution and respond to climate change and reduce inequality or it has the potential to make it worse. This is one of the points that was made by the Global Commission on the Economy and Climate. It said that “crucial investments will be made over the next 15 years in … land use and energy systems [and transport]. They have the potential to generate multiple benefits for economic growth human development and the environment; or they could lock countries into high-carbon pathways …”. So it is really critical that this is a major priority for how we prioritise infrastructure investment.Unfortunately here in New Zealand the National Government is not using that as a lens for how we prioritise investment. In fact it is prioritising a lot of investment in transport infrastructure in particular that is not only going to do nothing to reduce the cost of moving people and goods around New Zealand it is actually going to make our greenhouse gas emissions from transport increase rather than decrease. So that is a real lost opportunity here in New Zealand but we hope that the development bank—because it will be independent and not constrained by the narrow political ideology of the National Party here in New Zealand—will be looking to seize the global opportunity to actually respond to climate change reduce inequality and have an economy that is going to serve people and the environment better.There is some concern because of course there has been criticism of some of the policies of the World Bank and the IMF in the past. I think the basis of the criticism is that if the decisions are being made primarily by people with linkages to financial industries—like finance Ministers and central bank governors; if they are the only ones at the table—they end up pushing certain policies that do not represent the interests of everybody in the economy especially workers. So that is the basis on which Joseph Stiglitz for example has criticised some of the policies of the World Bank and has said that we need agencies that are dedicated to development. It is possible for those agencies to be making decisions that benefit everyone in the economy but if we have only a narrow group of people making the decisions it is very easy for those decisions to not reflect the interests of everyone in the economy but in fact to reflect the interests of their connection to people they know who are involved in the financial industries. These interests are often at odds with the real economy as we have seen over the past 10 years.But I am relieved to say that if you look at the Asian Infrastructure Investment Bank it states up front that its modus operandi will be to be lean clean and green: lean as in having small efficient management—which could be good but again we want to make sure that a broad group of people are involved in decision making; clean as in having zero tolerance for corruption; and green being an institution built on respect for the environment. So it is on that basis that the Green Party is very positive about this development and the possibilities for us to invest in infrastructure that is actually going to reduce pollution make people’s lives better and start to chip away at the increasing inequality that exists not only in this country but around the globe. There is a real opportunity there.I note with interest—and I have to agree with—the comments from Grant Robertson and David Parker. We do have concerns about the speed with which the bank has been established—it has been unprecedentedly quick—and I think that is something that needs to be canvassed during the select committee process. Particularly we have concerns about where the money that New Zealand is contributing is going to come from because comments have been made that it is coming from the Future Investment Fund which of course was the money set aside from the proceeds from the asset sales that National undertook last term. It is not clear that there actually is enough money in the Future Investment Fund to cover all the different promises that National has made.We in the Green Party certainly did not agree with the asset sales. We do not believe that that was an intelligent economic policy for New Zealand. We do not believe that it has done anything to reduce our debt which was one of the bizarre claims made by the Government at the time—that it was going to be reducing debt—and of course the promise that was made was that the proceeds would be invested in productive infrastructure for New Zealand like schools and hospitals and rail. Of course putting the money in something like the Asian Infrastructure Investment Bank is quite a different proposition from investing in infrastructure here in New Zealand. So it will be interesting to see where in fact the money is going to come from.One final point is that $125 million is going to be going towards this bank over 5 years to capitalise it. Before the last election the Green Party put forward a policy of having a green investment bank for New Zealand and in fact it was a very similar amount of money. It was $120 million over 3 years that we thought was needed to capitalise a green investment bank here in New Zealand that could then be run on commercial grounds and specialise in investment in clean technology and other infrastructure that is going to help us respond to climate change. We think that is a great policy. It makes a lot of sense. It is the sort of thing that one would think National would support. Of course it has not shown any support for it thus far but it is interesting that it is a similar amount of money for a similar purpose albeit this purpose.The Asian Infrastructure Investment Bank obviously has wider implications for our relationships with other countries but there is a case for having a green investment bank here in New Zealand to help prioritise the projects that are going to help us have an economy that is going to respond to climate change and allow future generations to prosper well into the future. Thank you.