Cunliffe David: International Finance Agreements Amendment Bill — First ReadingText is incorporated into the Bound VolumeCunliffe David: International Finance Agreements Amendment Bill — First Reading[Sitting date: 15 September 2015. Volume:708;Page:6609. Text is incorporated into the Bound Volume.]Hon DAVID CUNLIFFE (Labour—New Lynn): I rise to take a short 5-minute call in support of the Asian Infrastructure Investment Bank. I have got only 5 minutes so I will be very quick and clear about the reasons for that support and what is really going on here. I want to strip through some of the officialese that pervades the documents that we have in front of us. Supporting the comments of my colleague Dr Norman and congratulating him on his recent appointment to head Greenpeace New Zealand can I agree that there is a major gap in the international financial institutions. The World Bank has been spending too little in the Asian region the Asian Development Bank is worthy but of a smaller scale and the International Monetary Fund historically has got itself fairly tangled up in driving what has historically been seen as a pro-austerity set of economic measures rather than bankrolling sustainable development. That is less so it has to be said under the current chair Christine Lagarde and we welcome the progress in the broadening of the IMF’s agenda but there is a gap.Secondly this is about geopolitics. The US the architect of the Bretton Woods institutions which include the World Bank and the IMF really did not respond to the changing geopolitics and China threatened to go it alone. New Zealand was the first Western country to sign up to join this initiative by the People’s Republic of China to get a new Asian investment vehicle up. We did so as far as I can tell from the documents for the very good reason that an integrated China is better than an isolated China and that together provided that sufficient openness and transparency was included in the governance arrangements we might make this a constructive contributor to the region rather than a divisive one.This is interesting because in parallel with this are the Trans-Pacific Partnership negotiations sponsored by the United States. New Zealand was the first Western country to sign up to this Chinese initiative. You can imagine the pressure that will be on New Zealand to sign up to the Trans-Pacific Partnership and the offset arguments which are the wrong reasons for signing. It may or may not be a deal worth having but that has got to be judged on its merits in terms of New Zealand’s national interests.It brings me to the third point. I deplore the lack of specificity in the select committee papers produced by the Foreign Affairs Defence and Trade Committee officials. There is no quantitative analysis as to the economic return to New Zealand for this investment and it is not the first time that an international treaty has been proposed to this House with a matching capital investment and qualitative rather than quantitative analysis has been provided. The Ministry of Foreign Affairs and Trade is capable along with Treasury of better than that and Parliament should frankly demand it. This is not an inconsiderable amount of New Zealand money.Fourthly the Future Investment Fund is the source of that capital. This is not only an overspent fantasy but an improper use of Future Investment Fund capital according to the objectives that the Prime Minister and the Minister of Finance set for that fund. In that regard I think that New Zealand First has a point—not actually to say that we should not support the Asian Infrastructure Investment Bank but to say that the Future Investment Fund is an inappropriate source of that capital. It has already been spent a thousand times over for every pet project of every Minister. It was the result of the fire sale of New Zealand assets and its funds were to be protected for investment in New Zealand. That has been gainsaid.Finally let me say this. New Zealand officials have made a positive contribution to the governance arrangements and the agenda of the Asian Infrastructure Investment Bank being one of the first Western countries to participate in those negotiations. They have upheld New Zealand’s tradition of constructive engagement. They have done so by ensuring the appointment processes are safeguarded in the articles of agreement and that there are safeguards around effectiveness and procurement transparency and collaboration with other global and regional institutions—all built into the articles and for that I think that our diplomats deserve our thanks and congratulations.Let me conclude by summing up. Firstly there were and are grievous gaps opening up in the Bretton Woods system of international financial institutions. We ought to work closely with our American friends to ensure that those institutions are modernised and that those gaps are reduced. Secondly New Zealand was the first Western country to sign up to this Chinese initiative. It is a good initiative but we ought to understand the geopolitics around that. Thirdly this is being funded from an inappropriate source. It should be funded directly off the Crown balance sheet. Fourthly we ought to thank our officials for their work.