Twyford PhilREGIONAL COMPREHENSIVE ECONOMIC PARTNERSHIP (RCEP) LEGISLATION BILLFirst ReadingINTERNATIONAL TREATY EXAMINATION OF THE REGIONAL COMPREHENSIVE ECONOMIC PARTNERSHIP AGREEMENTHon PHIL TWYFORD (Minister of State for Trade and Export Growth): I present a legislative statement on the Regional Comprehensive Economic Partnership (RCEP) Legislation Bill.DEPUTY SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website.Hon PHIL TWYFORD: I move That the Regional Comprehensive Economic Partnership (RCEP) Legislation Bill be now read a first time. I nominate the Foreign Affairs Defence and Trade Committee to consider the bill. At the appropriate time I intend to move that the bill be reported to the House four months and one day after it has its first reading.It's a pleasure to speak in support of the RCEP amendment bill. This first reading is also in effect the debate on the report from the Foreign Affairs Defence and Trade Committee on RCEP. So allow me to thank the committee for their examination of the treaty which this bill implements. The committee met earlier this year to consider the treaty including calling for and hearing from a range of public submissions. This is an important role that the committee performs and I'd like to thank the members of the committee for their work as well as the members of the public who submitted on the treaty. I will address some of the points that they raised in the report throughout my speech.Multilateralism has taken a bit of a hammering in recent years. The rise of nationalism right-wing populism and great power rivalries have all corroded the will of nations to come together in multilateral institutions and together tackle the great challenges of our time. But the COVID pandemic has brought home to us the importance of continuing to invest in cooperative multilateral approaches in dealing with the great international issues of the day. It's also shown us how we all suffer when nations reject this approach and we've seen that in disturbing instances of what have been dubbed in recent times as vaccine nationalism".More broadly the very uncertain strategic outlook and the spilling over of political disputes into the trade arena have reinforced the need for nations to have diverse and robust trade relationships and to look more closely at the resilience of supply chains. It also means more than ever that multilateralism needs champions—countries who are willing to be leaders and to strongly and enthusiastically uphold the institutions the norms and the rules that make up the international order that all countries but particularly small states like New Zealand rely on to get things done and to avoid situations where a destructive might-is-right ethos undermines what we're trying to achieve generally but particularly in times of crisis like those we've seen over the last year during the COVID pandemic. At one point during the pandemic nearly 80 World Trade Organization (WTO) members imposed more than a hundred new restrictions and trade barriers. This is on top of the protectionist policies we've seen implemented in various major economies in recent years. The direction of travel is worrying and it's why as a Government we have prioritised both a response to the initial crisis through for example initiatives to increase the supply of personal protective equipment (PPE) and vaccines and maintaining supply chains for our exports but also through redoubling our efforts to build the trade architecture that will assist ours and others' economic recovery. So that is why agreements like RCEP the Regional Comprehensive Economic Partnership represent more than the sum of their parts more than the reduction and removal of tariffs more than new investment flows and more than just new markets for our exporters. The 15 countries and 31 negotiating rounds represent a commitment to cooperation and trade. They show that Governments can come together make compromises and strike deals that will lift each other up even in times when it feels like the mood for this kind of cooperation is at a low ebb. It's no coincidence that of all New Zealand's free-trade agreements to date they're all in the Asia-Pacific region. We've invested in the region with successive agreements—first the Agreement Between New Zealand and Singapore on a Closer Economic Partnership; the Trans-Pacific Strategic Economic Partnership Agreement (P4 agreement); the Hong Kong partnership; the China free-trading agreement (FTA); agreements with Thailand Malaysia Korea and more recently the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). RCEP was in its genesis an Association of South-east Asian Nations (ASEAN) initiative. And of course South-east Asia is a region that New Zealand has a long and important trade relationship with. Indeed ASEAN has risen to become New Zealand's fourth-largest trading bloc. But this deal also includes a number of countries with which ASEAN has free-trade agreements with: Australia China Japan South Korea and of course New Zealand. The 15 countries that RCEP covers are home to almost a third of the world's population including seven of our top trading partners taking over half New Zealand's total exports and providing more than half our direct foreign investment. In the year ending December 2019 New Zealand exported more than $36 billion worth of goods to RCEP countries and nearly $12 billion of services. India was initially part of the negotiations for RCEP and their withdrawal in late 2019 was a disappointment. However the RCEP countries have put in place a fast-track accession process for India should it wish to rejoin in the future. I want to say today on behalf of the Government that we value our relationship with India and we will continue with pursuing our aspirations to broaden and deepen the political cultural and trade links that we enjoy with India. Given New Zealand's existing free-trade agreements with RCEP nations tariff reductions are not where the action is at. It's not where we will see most of the benefit from this agreement. Though in saying that exporters of sheep meat beef fish milk cheese honey and avocados to Indonesia the fourth most populous country in the world will see tariffs eliminated on their products above and beyond the current arrangements. The areas of services and investment are where the big gains will be made as well as the lifting of non-tariff barriers with China and the largest ASEAN countries having made investment market access commitments to New Zealand for the very first time. On non-tariff barriers RCEP creates an expectation that customs authorities will for example release perishable goods such as seafood within six hours of arrival including the release of such goods outside normal business hours which should reduce spoilage and save exporters money. That might seem like a very small practical benefit but I'll say this: for our seafood exporters who are an important part of our export industries that will be a very significant benefit. From recent experience speaking to exporters like our $155 million a year onion exporting industry just the other day I know how frustrating these non-tariff barriers can be and what a real impediment they are getting goods to market. Another key benefit is the establishment of a single rule book covering all 15 markets within RCEP. This represents a significant reduction in cost and complexity for exporters meaning they can spend more time selling their products and less time filling out paperwork. Over time the economic benefit to New Zealand of these changes will be considerable. Independent modelling predicts that once RCEP is fully in effect New Zealand's annual GDP will be between 0.3 percent and 0.6 percent larger as a result. That amounts to $1.5 billion to $3.2 billion in annual GDP. These expected benefits show why trade has been a central part of the Government's plan to recover from COVID-19. Our trade recovery strategy has three main pillars: re-tooling support for exporters refreshing the international trade architecture and re-energising and refocusing our key trade relationships. It's not just about more and better trade links but actually helping our exporters make the most of the opportunities in overseas markets. I'm proud to be part of a Government that in turbulent times is leading the way in ensuring that New Zealanders are responsible proactive and engaged global citizens. It's also a Government however that does not pursue trade cooperation simply for its own sake. It is a means to an end because done properly we know that trade can lift the living standards of New Zealanders and secure the future prosperity of our nation. DEPUTY SPEAKER: The question is that the motion be agreed to and that the House note the report of the Foreign Affairs Defence and Trade Committee."