Hodgson Pete: Tariff (Malaysia Free Trade Agreement) Amendment Bill — First Reading 
Hodgson Pete: Tariff (Malaysia Free Trade Agreement) Amendment Bill — First Reading 
[Volume:662;Page:10283] 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 We are largely agreed in this House on the benefits of this free-trade agreement. I am sorry to say that I was not here to listen to the contribution of the Greens. I dare say that I would have listened to it with some measure of agreement and some measure of disagreement—and I hope a lot of respect—but as I did not hear it I cannot comment further. Beyond that generally speaking the parties in this House seem to think that our progress on free-trade agreements is satisfactory. I add my remarks about past trade Ministers and also past and present officials who of course do the yards. Yes we are gathering pace. Doha appears to be making very slow progress so our ability to make bilateral progress in the stead of Doha matters. However that is where my agreement with National rests at the moment. 
I have become increasingly disturbed over the past 15 or 18 months about the ability of this Government to follow up on free-trade agreements. I have been concerned about the ability of our exporters to follow up on the ASEAN agreement. I am concerned about the ability of our exporters to follow up on the Malaysian free-trade agreement. I think that our ability to follow up on the Chinese free-trade agreement was better and that is the distinction I would draw. People can call it partisan if they wish; I think it matters. I think it matters that when we got ourselves a free-trade agreement in China we took a number of steps. There were and still are a number of trade missions going to different parts of China. The signing ceremony was a significant public event and was carried significantly in all of the major dailies in New Zealand and China. Admittedly that was because it was China’s first free-trade agreement and they were thinking that having one was a pretty good start but that has not been the case with this free-trade agreement in Malaysia and it has not been the case with the ASEAN free-trade agreement. 
I think that we are dropping the ball in terms of the Government’s role in promoting follow-up to the establishment of a free-trade agreement. It is as if the Government is saying that it has negotiated an agreement and now the exporters of this land of New Zealand can go and make good but it will not be able to help them any more than it helped them before. That is simply wrong. It is simply wrong for there not to be some Government involvement. Of course most of the job rests with the exporters. Of course the private sector is the key player in export development. That is obvious. 
The Export Credit Office was begun under a Labour Government and is getting stretched I imagine by the drying-up of credit in the last 18 months. I wonder whether the budget for that office will be extended next month in the Budget. I do not think so. 
I wonder whether the Beachheads programme which was started under a Labour Government and has been retained by this Government will be expanded by this Government. After all when we got ourselves into China a Beachheads programme went with the free-trade agreement. As far as I am aware there is no way that a Beachheads programme is going with the free-trade agreement in Malaysia; I would like a Government Minister to get up and tell me that I am wrong. I wonder whether we can make as big inroads with our agricultural exports into Malaysia when we have ditched Fast Forward and whether our exporters feel as supported as they might have had we not done so. 
I wonder what has happened to Market Development Assistance which was again begun by Labour and continued for a number of years. It was in transition under the previous Government so I am not suggesting that it would have remained unchanged had there not been a change of Government; it was being migrated across to the Growth Services Fund which is a new label with a new purpose and a slightly different set of policies. But I know that in the meantime the money has gone missing. 
Just at a time when we need say a Growth Services Fund for our biggest exporters we find that that is not available any more and that is troubling me. I think that perhaps not our biggest exporters but some of our medium-sized exporters that are growing quickly will have significant cash-flow problems and will have significant problems breaking into new markets and setting up new relationships quickly yet that is exactly where a good Government can make a difference. I assert—with I think some knowledge in the matter—that when it comes to more recent free-trade agreements the Government has pretty much said to the export sector that it is on its own. Of course the export sector does not have to have a Government to make progress. Indeed I recall that in Malaysia before a free-trade agreement the volume—I think it is a volume figure—of trade doubled between 2004 and 2008. It is already a rapidly growing export market but it is a big country. 
I ask whether we are satisfied with that level of growth. Why can we not aspire to greater levels of growth? Is it not a fact that we have a persistent current account deficit? Is it not a fact that if we continue to have a current account deficit then we will continue to own less and less of our own country? Is it not clear that investment flowing into New Zealand to buy dairy farms or whatever is created by the fact that we have an external account deficit? Is it not the case that if we can sell more then we can own more of our own land? That has not reached the desperate stage yet but some people are getting worried—I am starting to. 
I think that when we have a free-trade agreement coming along we should nail it. We should not just negotiate it; we should go ahead and nail it subsequently with good export assistance. In the case of Malaysia it is made all the easier by 30 or 40 years of Malaysian students training in New Zealand. Our knowledge of each other’s countries is already quite good. The amount of interpersonal relationship between New Zealand and Malaysia is already quite good. 
I have the pleasure of representing Otago University. Even today if one looks at the numbers of foreign students at Otago University one sees that after the US Malaysia comes second. It is ahead of China ahead of Germany and well ahead of Australia the UK or any of those nations. Malaysia comes in second. 
Even today long after the demise of the Colombo Plan 40 years ago we have through export education very very strong links with Malaysia. This is a country where we can do seriously good business because we have seriously good relationships and seriously good history. But if there is no Beachheads programme if there is no Market Development Assistance fund if there is no intention on the part of the Government to support those companies that need an Export Credit Office to get themselves a bond lodged in order to go and build a travelator at Kuala Lumpur Airport or whatever it is to be and if there is no support or insufficient support for our exporters then we have done only half a job. Half a job when there is a current account deficit the size of ours is not good enough and it is not good enough for National members to bang on at length about how we need to have more exports but at the same time we need to reduce the amount of programme support that is going to our exporters. It was modest enough under the previous Labour Government one might argue but it is getting even more modest indeed. 
That is not to say that New Zealand Trade and Enterprise does not do a good job and it is not to say that that agency is somehow absent in Malaysia. Neither of those things is true. The question is: what is enough? If we have a country with which we have a volume of trade that has doubled in 4 years and with which we have extraordinary historical links then surely we should be going hard after further trade development with that country. I bet they are going hard with our little economy. I bet they are! But that is not the case when we look from New Zealand towards Malaysia. 
I congratulate the Government on concluding the free-trade agreement. I hope this legislation passes quickly and I ask the Government to please start paying attention to ensuring that we can put some runs on the board now that we have the ink dry on the paper.