Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill — Second Reading 
Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill — Second Reading 
[Volume:630;Page:1993] 
Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill 
Second Reading 
Hon ANNETTE KING (Acting Minister of Trade) 
: 
 I move  
That the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill be now read a second time 
. 
Dr the Hon Lockwood Smith 
: Jim did most of the work on this. 
Hon ANNETTE KING 
: Dr Smith is quite right. I thank the Foreign Affairs Defence and Trade Committee for its consideration of this bill and for reporting the bill back to the House in the short space of time the House requested of it. The committee’s majority recommendation is that the bill be passed with no amendments. Although the time available for the select committee consideration was short the committee was able to consider the bill in light of submissions made during the committee’s earlier consideration of the national-interest analysis of the Trans-Pacific Strategic Economic Partnership Agreement. 
This bill amends New Zealand’s domestic legislation to enable New Zealand to become a party to that agreement: a four-way economic partnership between New Zealand Chile Singapore and Brunei. The Trans-Pacific Strategic Economic Partnership Agreement is a treaty that liberalises and facilitates trade in goods and services improves the business environment and promotes cooperation on a broad range of economic areas of mutual interest in all four countries. The agreement offers real gains to New Zealand exporters through the establishment of a free-trade area that spans the Pacific and joins Latin America South-east Asia and New Zealand. The agreement serves the objective of wider trade liberalisation within the APEC region as a whole. 
The bill amends the Tariff Act 1988 in order to bring it into line with the Trans-Pacific Strategic Economic Partnership Agreement. The passage of the bill will allow New Zealand to ratify the agreement which will enter into force 30 days after ratification by at least two of the four signatories. The bill contains an amendment to the Tariff Act to enable preferential tariffs conferred by the agreement to be applied to the parties to the agreement. The tariffs conferred by the agreement are included in the preferential tariff column of the New Zealand tariff. The actual rates of duty as spelt out in the agreement will be added to the tariff by subsequent Orders in Council. 
Initial tariff cuts will take place when the Trans-Pacific Strategic Economic Partnership Agreement comes into force for each party. In the case of Chile that will result in the immediate elimination of tariffs on 89 percent of current New Zealand exports to Chile while all remaining tariffs on exports to Chile will be phased out by 2017. Brunei will bind at zero tariffs covering 92 percent of New Zealand exports to that country with remaining tariffs to be eliminated by 2015. Tariffs between New Zealand and Singapore are already zero under the existing New Zealand - Singapore closer economic partnership agreement. 
In order to help secure those gains on trade and goods the Trans-Pacific agreement contains rules that govern the free-trade area. Those include rules to determine which goods qualify for tariff preferences as well as rules to counter unfair trade. The agreement also includes broad coverage of services which will make it easier for New Zealand service providers to operate and compete in the markets of Chile Singapore and Brunei. In this and in other ways the agreement will assist in improving the business environment and will open up opportunities for New Zealand businesses. 
The Foreign Affairs Defence and Trade Committee considered the agreement under the international treaty examination process. Its report to the House notes that the agreement serves New Zealand’s objective of broadening relationships with Latin America and Asia as well as promoting New Zealand’s wider trade policy interests in APEC and multilaterally. Issues relating to the agreement were raised at the select committee. It was acknowledged that the Government’s aim in entering negotiations for closer economic partnerships is to provide new opportunities for exporters and to guard against the erosion of benefits for New Zealand exporters from preferences afforded third parties. The report also recognised that the framing of the service commitments in the agreement provides legal certainty and transparency for New Zealand’s service exporters while it retains New Zealand’s ability to protect sensitive sectors such as social services water and marine resources. 
A minority view presented in the select committee report raised concerns about the economic benefit to New Zealand of the agreement. Those concerns were based in part on a perceived failure of the bilateral closer economic partnership agreement with Singapore to advance New Zealand’s economic interests. Contrary to that belief since the Singapore closer economic partnership agreement entered into force in 2001 and despite the downturn in the Singapore economy between 2001 and 2003 there has been a large increase in investment and service activity between New Zealand and Singapore. Between 2003 and 2004 New Zealand exports to Singapore increased by 21 percent. The Singapore closer economic partnership agreement like this agreement has a strategic focus that is intended to foster partnerships between the private sectors of its parties and it has been very effective in doing so. 
We have every confidence that the Trans-Pacific Strategic Economic Partnership Agreement will produce even better results for New Zealand. That confidence is shared by a wide range of New Zealand businesses and industry groups and by educational and scientific institutions which have publicly welcomed the successful negotiation of this agreement and which are looking forward to its entry into force. Ratification of this agreement will reinforce New Zealand’s credentials as a forward-looking open economy and a progressive free-trade agreement partner. It represents significant economic and strategic opportunities for New Zealand. I commend the bill to the House. 
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
: 
 Let me be very clear from the outset that National supports the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill which is very important for New Zealand’s future. It saddens me a little that the Hon Jim Sutton did not speak first to the second reading of this bill. Although I have nothing against the Hon Annette King—apart from the fact that she is a Labour Minister—Jim Sutton deserved to be speaking first on the bill because he did most of the work to get the negotiating behind the legislation in place and I want to acknowledge his work in that area. 
Although National supports the bill because it is so important for New Zealand—not just in our trade with the particular countries involved but because of its strategic value for New Zealand and I will come back to that later—I want to raise an issue that I think is unfortunate and sad. The Minister in moving the second reading of the bill just now mentioned that the phase-out of New Zealand’s tariffs on products coming into New Zealand from both Chile and Brunei will extend through to 2015 in some sectors—notably the clothing textile footwear and carpet sectors. 
The reason that is unfortunate is that the development of this strategic trade agreement just like the original Singapore agreement that preceded it was designed to galvanise APEC development. When New Zealand was chairing APEC in 1999 and even in the time leading up to that it was clear then that a huge challenge for APEC—the Asia Pacific Economic Cooperation group which covers half of global trade—was to meet the 1994 Bogor goals of free and open trade among the developed members of APEC by 2010 and among the developing members by 2020. One of the reasons that the National Government initiated negotiations like that when I was the Minister for International Trade was to try to bring some leadership to APEC because we could see the real challenge to meet those Bogor goals that were so important to liberalising trade globally. 
With this agreement just like with the free-trade agreement with Thailand that the Labour Government agreed to the New Zealand Government is itself breaching New Zealand’s commitment to APEC because it has made a commitment to APEC that we will have free and open trade that we will liberalise trade by 2010 as a developed member of APEC—unless the Labour Government considers that under its stewardship New Zealand has slipped from being a developed member to being a developing member of APEC. We have made a commitment to free and open trade by 2010 yet this strategic trade agreement and this legislation breaches that commitment because our tariffs will continue beyond 2010 for certain imports from Chile and Brunei. 
That is unfortunate but it is not without precedent—Labour agreed to that in the free-trade agreement with Thailand. It is unfortunate that New Zealand has failed to show leadership in sticking to our APEC commitments since those trade negotiations were originally all about galvanising the APEC process. 
I want to come back to that. All of that started back in the late 1990s when New Zealand was planning for its chairmanship of APEC in 1999. I mentioned a moment ago that we were concerned about the challenges of progress so when George Yeo was the Trade Minister for Singapore we initiated that free-trade agreement negotiation with Singapore the whole idea being to show other members of APEC that countries could get on and actually negotiate far-reaching free-trade agreements. It was not the trade between Singapore and New Zealand that was relevant; it was its strategic value and the demonstration to other APEC members that these things could be done and that we could get on with it. My goodness I think it is fair to say—and I see the Hon Jim Sutton nodding his head—that the negotiation of a free-trade agreement with Singapore had a profound impact on the thinking of other APEC members including Malaysia Australia and even Chile. 
At that time New Zealand had initiated that negotiation with Singapore. That agreement was initiated between me as New Zealand’s trade Minister and George Yeo as Singapore’s Trade Minister. In fact my good colleague here Tim Groser was our chief trade negotiator at the time and he did the real hard work on that trade negotiation. 
At the same time though we had a bigger strategic vision. There were key players in APEC involving the US Trade Representative the New Zealand trade Minister—myself—the Chilean vice-Minister of trade Alejandro Jara the Singaporean Trade Minister George Yeo and the Australians. In fact Tim Fischer was the Deputy Prime Minister and Trade Minister of Australia at the time. 
We had a bigger strategic vision that we called P5. That whole concept was to really bring some progress to APEC by linking up APEC members right across the Pacific—the United States Chile New Zealand Australia and Singapore. It would have been a magnificent trade deal. When President Clinton was in New Zealand during his State visit following the APEC leaders’ meeting in 1999 he told the Shipley Cabinet at that time that he liked the idea of P5 and that he was keen to see it pushed ahead. I know that his Trade Representative Charlene Barshefsky who remains a very good friend to this day was totally behind that trade deal. George Yeo and the Singaporean Prime Minister were totally behind P5. Chile was behind P5 as long as it did not cut across Chile’s long-promised free-trade agreement with the United States of America which Chile had been promised for many years. Finally even Australia which maybe was not quite so enthusiastic initially came to the party as well and said that it wanted to be in that. It was sad that we ran out of time. We saw the elections in the United States that changed the Government there and the elections in New Zealand that brought in the Labour administration and that changed totally the dynamics between New Zealand and the United States that had seen the concept of P5 almost advanced to fruition in late 1999. 
At the time we realised that P5 might not be as easy as that. We knew that the United States trade agenda at the time was very full with giving China permanent most favoured nation treatment in US law. Getting major trade legislation through the United States Congress is always challenging and at that same time the United States had to get that legislation through its Congress. So we knew that P5 was always going to be difficult which is why Tim Groser and I worked with some key players notably Alejandro Jara who is now a deputy director-general at the World Trade Organization and Ricardo Lagos Weber the son of a former President of Chile who I think is now Trade Minister for Chile. 
We were working at the same time on this concept of P3. P5 was the big strategic picture. If P5 could not go ahead for whatever reasons—maybe Australia was not totally enthusiastic or maybe the United States was too preoccupied with China’s accession to the World Trade Organization and making China a permanent most favoured nation—we wanted to make sure that there was a strategic concept that would advance APEC’s trade liberalisation goals. So P3 was initiated as a concept way back in late 1999. Tim Groser reminds me of the work we did on it at the Carlton Hotel as we were chairing APEC at that very time. 
So these developments do not happen in a short time. It is now almost 7 years later that we are passing this legislation. Where New Zealand is fortunate is that we have bipartisan recognition in our Parliament at least in recent years. When I was trade Minister I have to say that I did not get all the support from Labour that Labour has had from us on these trade issues but at least now that Labour is in Government it has shown that it realises the vital importance of trade liberalisation not just to New Zealand but to global economic development. I think we are fortunate in New Zealand that our major political parties do understand the importance of trade liberalisation and that these kinds of strategic agreements and legislation have the almost unanimous support of this Parliament. It puts New Zealand in a hugely strong position to lead these kinds of strategic developments internationally. It is an important role we have and it is just a shame that Labour breached that leadership role in allowing our tariff phase-outs to go beyond our APEC commitment of 2010. Despite that issue National is totally supportive of this legislation. 
DIANNE YATES (Labour) 
: 
 I rise to speak on the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill and I want to thank the previous speaker for his comments and the support of the National Party for this legislation. It is an interesting process because the actual legislation is only about a page long. It is the culmination of a treaty-making process. The amount of time spent on the bill by the Foreign Affairs Defence and Trade Committee was very short indeed—in fact it was just one meeting—with the reason being that the bill is the culmination of several years of work as Dr Lockwood Smith has just pointed out. A lot of hard work was done by a number of people over a period of time so perhaps the more important debate was the debate we had on the national interest analysis some weeks ago in this House when we looked at the submissions from members of the public and the statements in the national interest analysis. In fact the committee reported the bill back to the House in one sentence and referred to that analysis. 
The bill as we have seen amends the Tariff Act 1988 to enable the Trans-Pacific Strategic Economic Partnership Agreement to be brought into force. That is why it is such a short bill and why it will not take up a great deal of time in the House. As has been pointed out that agreement has been signed by Brunei Darussalam Chile New Zealand and Singapore. I wish to thank the Hon Jim Sutton for the work he has done on this agreement for the Hon Phil Goff and I also thank the Hon Annette King for the contribution she made today. I also thank all the officials involved in the whole process throughout the period of time spent both on the bill and on the national interest analysis. So a big “Thank you” goes to those involved in getting this bill back to the House in a timely fashion and in particular I thank the members of the select committee who have worked very well together in bringing that about. 
We have talked about the importance of this agreement to New Zealand’s economic growth prospects over a period of time. We have also pointed out that this is the first agreement with a Latin American country and it is New Zealand’s first multiparty agreement spanning the Asia-Pacific region as Dr Lockwood Smith just pointed out. We have noted that the majority of the members on the select committee were in favour and that there was one opinion against from the Green Party. That has been referred to in the report back and especially in the report back on the national interest statement. 
The committee has noted that the agreement is not expected to have discernibly negative social effects and that there are no adverse cultural effects although there were some questions about that. In particular on the national interest analysis it was reported back by us that we were aware that in the creative areas an exclusion was inserted to clarify that New Zealand could take action to support creative art of national value. The provision has several caveats ensuring that it does not constitute an exclusion for the creative industry sector but we noted that National Party members had a minority opinion on that section. 
When we considered the national interest analysis we noted also that there were only three submissions. Two of those submitters were concerned about the risk contained in the negative list. I will read from our report back to the House: “The negative list approach means that if a service sector is not listed in the services schedule then it is bound by the national treatment market access and most favoured nation obligations. The point was raised that these commitments will apply even if the list contains errors if new technologies alter the way services are delivered or if market failures require the government to re-regulate. Further it was suggested that the ratchet clauses may have negative repercussions by allowing the Government to introduce policies that could not subsequently be reversed.” We were assured and we understand that the negative list has been framed to ensure that future Governments can adopt restrictions in far more sectors than our laws currently require and we were also assured that New Zealand is more likely to benefit from that provision than to suffer from it. 
We point out that as there were only three submissions on the national interest analysis the committee did not call for submissions on the bill itself. The national interest analysis included a huge number of submissions and the whole issue had been taken around the country through an extensive consultation and communication programme. One of the people who came to the select committee said that there had not been enough time to look at the analysis. I wonder how much time some people need when they have actually had years to look at some of these provisions. The consultation programme on the national interest analysis included everybody from trade unions to Maori authorities to chambers of commerce and there are many pages that list people who are considered to have had input. So the select committee felt that the complaint about lack of time was not warranted in that case. 
We commend this bill on its second reading. We look forward to its speedy passage through the other stages in the House and to the final ratification of the treaty. 
JOHN HAYES (National—Wairarapa) 
: 
 I rise also to support this legislation primarily because we on this side of the House want to see a free economy and a free trading system. A free economy and a free trading system is the only way to create wealth and prosperity which this country badly needs. Prosperity alone will give us the resources to pay for better services to the community and better services for those in need. The attack on private enterprise by the Labour-led Government through its highest tax structure has made certain that nothing will be available for improvements in the social services area for some years to come. We need to get the private sector generating wealth not just to put more money in pockets but so that we can give more money to those who need help: the old the sick and the handicapped. This trade agreement will make a minute impact on economic growth but because it will make a positive impact on economic growth we support it. 
I suspect that the trade agreement has actually cost more to negotiate than it will deliver. If we refer to the national interest analysis we see clearly that this agreement will cost us about $472000 each year to operate. Of that $150000 annually has been set aside by the bureaucrats for their administration fee. Then we will lose some money from tariff revenue to the tune of about $320000 for Chile and about $1800 for Brunei. The gains from this agreement are estimated to be about $2.2 million in reduced duties paid by our exporters to Chile and about $50000 in reduced duties to Brunei. The total gains as a result of this agreement look to be $2.25 million and the cost is about $472000 so the equation has a positive balance of $1.78 million. Therefore I support it. 
However I come back to comments made by the Hon Dr Lockwood Smith. He has pointed out that this agreement is missing the involvement of Australia and the USA. I do not see that changing under this Labour-led administration. That is a big pity because we could turn this minute benefit into something of serious significance for our country. 
We support this agreement because it will help our casein exports and facilitate coal exports to Chile. It should also make it easier for our business people to operate in Chile and Brunei. It is also worthy of note that benefits will accrue to New Zealand if the other partners to the agreement enter into new trade agreements with other parties and gain greater benefits than the agreement provides for at present. Those benefits will eventually accrue to New Zealand. But I warn people in my electorate that we will have increased competition from both Chile and Brunei in the areas of forestry and wine. The value of this agreement—$1.78 million annually—is less than 50c for every man woman and child in this country. It really is a pretty poor effort for a huge amount of work. We must seriously focus our trade negotiations on agreements that will deliver bigger benefits than this one will. But this is certainly a start and that is why we support it. 
KEITH LOCKE (Green) 
: 
 The Green Party opposes this legislation. It is legislation required to implement New Zealand’s adherence to the Trans-Pacific Strategic Economic Partnership Agreement which the Greens oppose as not being in accord with New Zealand’s best interests. This is an ideological agreement that wrongly sees free trade with the countries involved as the answer even though we are not on a level playing field with them in terms of wages environmental and labour standards or State support systems. As I said in the first reading debate the Green party supports trade agreements but not ideological free-trade agreements. We support the CER agreement which has brought many benefits to New Zealand and operates in tandem on both sides of the Tasman with Buy Australian and Buy New Zealand Made campaigns. The Green Party under the terms of its relationship with this Government is in charge of a “buy New Zealand” campaign that we hope will produce benefits within the framework of the CER agreement. The CER agreement has some downsides as well which are outlined in the relevant report—and particularly in my minority comments on it—presented by the Foreign Affairs Defence and Trade Committee a couple of parliaments ago. 
In my first reading speech I covered the range of Green criticisms of the Trans-Pacific Strategic Economic Partnership Agreement. I will not repeat all of them now. In this speech I want to concentrate on the service component of the agreement that this bill implements. I am particularly worried about the negative list of commitments New Zealand and the other three countries make in the services area of the agreement. This is quite new. It does exist in the CER agreement but in free-trade agreements generally it is a new approach. It means that if New Zealand does not put a certain sector on the negative list from then on that sector has to be open to foreign providers—for New Zealand and the other three countries to be on an equal footing. As things roll on with other free-trade agreements—bilateral agreements multilateral agreements and the World Trade Organization General Agreements on Trade in Services (GATS) negotiations—that access to our service sectors will be extended to other foreign providers. 
I want to go over some of the problems that the negative list produces in the services area. First there is the problem of a Government making a mistake in failing to list a particular sector of importance to the New Zealand people. That failure will then bind future Governments. We already have the problem for example in relation to a mistake made by a previous Government in the GATS commitments relating to audio and visual products which means that it is hard for New Zealand to introduce local content quotas for radio and TV other than voluntary quotas. 
Second a sector can be left off the list and then technology may change in a way that was not foreseen. New Zealand then becomes defenceless in terms of upholding its interests against foreign providers because it is no longer able to deny them the same treatment. The United States had this problem in the area of betting services when it allowed foreigners in. Internet gambling then came along and although the United States Government wanted some local control in the area the cat was already out of the bag. Antigua and Barbuda took a case to the WTO against the US on the Internet gambling issue and won. 
Clearly the whole information technology sector is one in which all kinds of changes may occur that we do not foresee at present. In New Zealand we have already found that we are hamstrung in the information technology area by Telecom which has a monopoly over the local copper wire loop. Under the agreement and the whole GATS approach that New Zealand has committed to if we are bound into commitments when confronted by problems like this we must use the least intrusive means of regulation which of course plays right into the hands of organisations like Telecom. Telecom is arguing that its approach to broadband is the least intrusive approach and that it should be the one that the New Zealand Government adopts. Surely the New Zealand Government should reserve its right to intervene on a whole range of sectors without such restraints particularly if players who are effectively monopolies are stuffing things up and not investing properly in the sector etc. We have seen tragedies across a range of infrastructures—for example rail with Tranz Rail airlines with Air New Zealand’s earlier failure and also in the telecommunications area with Telecom. 
As with a lot of legislation that passes through the House there is now sometimes a tendency to look at it in terms of how a Labour-led Government might implement it as opposed to a Government of the future that might be further to the political right. Take for example the reservations on the negative list of services under annex IV of the agreement. They include reservations over social services established for a public purpose such as public education public housing public training public transport and public utilities. That sounds good on the surface but then what happens when for example a future Government applies voucher-type solutions in those areas as National and ACT tried to do? Already the public support for housing—the accommodation supplement—goes mainly to private housing. So there is a difficulty in disentangling the public and the private in terms of those reservations. 
If National brought in education vouchers as its prime means of funding education with no discrimination between their use in the public and private school sector then the reservations in the bill would mean little. The present Government is really keen on making the provision of private education open to international providers partly because New Zealand private providers are selling services in other countries. But could our whole education system here in New Zealand not be distorted in favour of private providers and foreign private providers if the open foreign access was combined with a new voucher system introduced by a future Government? 
The public transport reservation could also be bedevilled by open access to foreign passenger-transport providers private providers or private road builders under moves towards public-private partnerships that move to the provision of private roads which the National Party is talking about increasingly. Future right-wing Governments might go down that track. How does the reservation in the agreement apply under that scenario? Because of the ratchet provision in the agreement once a future right-wing Government goes down what is effectively a privatisation track a future centre or centre-left Government would find it very difficult to reregulate without affecting the agreement rights in the system of those foreign providers. 
We already have light-handed regulation in areas like taxis construction and the provision of private education services—and we know that every time we see a huge queue of taxis at the airport hear about more leaky buildings or read about dodgy foreign education providers with inadequate courses. Under article VI of the GATS we are not supposed to reregulate once we have deregulated. Would the public utilities reservation in annex IV of the agreement include environmental services or waste facilities? It is not clear. There is no specification in the annex. And who would determine if they are covered? That would be done by an international arbitration mechanism. It would not necessarily go New Zealand’s way. There is a lot of looseness there. 
Also interesting is the reservation for maritime and port services. It is true that up until now we have not had foreign provision of those services. But now we see Hutchison Port Holdings—a huge multinational company run by a Hong Kong billionaire—being offered control of the port by the Christchurch City Council. That will not be in the interests of Canterbury or New Zealand so it is hard to see how those mechanisms in the agreement will help the New Zealand people. 
TIM GROSER (National) 
: 
 I am also rising to support this bill. My two colleagues earlier explained our general political position on it. From Keith Locke we have just heard what I would describe as an entirely consistent view from the Green Party. It is basically a view that sees the restraints on sovereignty through international trade treaties as an encroachment upon the rights—as I would put it—of Governments to mess up our own economy. So I think that that is the only fundamental difference in this House. Yes we have a couple of small points to make; we would have liked to have seen some slight changes to this agreement. But they have been touched on by other speakers so I will not go into them now. 
What I want to do on this occasion—the second time I have spoken on the agreement—is to explore a little more deeply the broader strategy behind the agreement. The title is quite a mouthful: the Trans-Pacific Strategic Economic Partnership Agreement. But although it is rather a mouthful and one might also say slightly pompous the title is correct. The agreement is not fundamentally about advancing our economy by any appreciable amount. We all know that the net benefit is trivial. It really requires a deeper understanding of the strategy behind this agreement to understand why it has been worth negotiating. So from that perspective I will go back in history a little. 
I would describe New Zealand about 25 years ago as being up the creek without a trade policy paddle. We had no way multilaterally through the GATT because agriculture—our chief interest—was outside it. We had only one very poor-quality bilateral agreement—the so-called New Zealand - Australia Free Trade Agreement—and nothing else. It was a very difficult environment made more difficult—as all members in the House will know—by the decision of the United Kingdom to join what was then a completely unreformed common agricultural policy going mad. As a very small country with very little leverage—friends but no leverage—the situation in the early 1980s was extremely bleak for this country. 
We then saw through the 1980s a slow shift in that fundamentally bleak position as a result of a number of factors. One was internal economic reform which changed the economic prospects of this country from very poor to average or to a little better than average OECD levels—although it took 5 or 6 years to have any effect starting from 1991. Internationally also the cynicism that was felt in this country about the multilateral option—the GATT as it was then called—began to be addressed as people began to incorporate agriculture for the first time in the Uruguay round. So that very bleak situation multilaterally started to shift to our country’s favour in the 1980s. 
Around about the early 1990s after several failed attempts by New Zealand to try as I have put it in the past to find dancing partners—that is some countries that we could negotiate with beyond CER-type deals—the National Party formulated a trade policy strategy called New Zealand’s multilateral trade policy which was launched by Jim Bolger and the then trade Minister Phillip Burdon. That basically put down three propositions for us none of which were mutually exclusive. The first was that we would proceed on the multilateral track. Second we would continue unilateral reform of trade policy because it was in this country’s own interest to accelerate that at a faster pace than negotiations would allow and thirdly we would negotiate this type of agreement the bilateral track. 
That strategy I believe is still valid today and this decision that we are debating tonight is absolutely an outcrop of that strategy. With regard to the multilateral track which is under way in the Doha round we must remember that that is far more important than any of those agreements—including a free-trade agreement with the United States and including a free-trade agreement with China by whatever name because some of the instruments of trade policy that New Zealand desperately needs to reform can only be done multilaterally. Export subsidies are the most important and the most obvious example of that. 
The second track the unilateral track has run its course. We have cleaned out the mess that was New Zealand’s frontier policy. There are a few small tariffs in textiles and clothing but frankly the recent shifts in the last few weeks and the exchange rate show us how relatively unimportant those are. Where that policy used to be a huge issue it no longer is. 
So the real issue here is the third track the bilateral track and this is where this deal assumes some strategic significance. Now it has always been central to the bipartisan position of successive National Party caucuses and Labour Party caucuses that certain basic principles should be followed in the construction of those agreements. The most important principle is comprehensive commodity coverage in the area of goods. Members will understand that there is a basic divide between services and goods. I have never argued for comprehensive coverage in services for a number of reasons but there has been absolutely an article of faith that we do not agree to exclude our key sectors of export interest. We can live with the second principle—progressive liberalisation after comprehensiveness—in order to deal with the political realities involved because often our main exports are extremely sensitive. The reason why after several stillborn attempts with Chile it has taken so long to get the Chileans to the table here is the huge concern in Chile over what is really a very very small tariff on dairy products. Chileans see us as the competitive threat. 
So the first and key principle is comprehensive coverage—that is we should never go into an agreement that excludes our main export interests—and secondly to make that realistic we must agree to progressive liberalisation. We do not have to insist on too ambitious a timing formula to deliver very real benefits to New Zealand in those highly sensitive agriculture areas. There are some other principles underlying the agreement but they are the two key ones. 
When we look at this agreement we note that it is of trivial—it is of possible but it is of trivial—trade significance. Dr Lockwood Smith earlier sketched some of the political background to it but I think we should also see that as New Zealand’s plan B if the multilateral option were to fail. Personally I think it is less likely to fail than to succeed and I have already given the House the dubious benefit of my views on that but of course failure is possible and cannot be completely excluded. 
What we have put before the House today is our plan B and it is absolutely vital that New Zealand which has so little leverage in the Asia-Pacific region aggressively promotes every opportunity it can find. It was quite a coup to get those four countries together across the Pacific to have this agreement. It was not obvious and it is exactly the sort of agreement that opens up policy space for us in the future. I personally do not think that we as a country need to be obsessed with the Asia-Pacific region. I think the old slogan “Asia first but not Asia first and last.” applies to New Zealand. I would not even exclude some type of more structured relationship with the European Union if its own reform of its agricultural policy progressed to the point where that became a more realistic option from the union’s point of view. But the key focus is in the Asia-Pacific region and this agreement brings in some of the APEC members. It has synergies there into the APEC formula. It also continues to breach into the ASEAN area that is of fundamental importance to New Zealand. Other negotiations are taking place there. I think that that is entirely complementary. 
Once again I want to go over the basic strategy behind this agreement. It is a long-standing strategy. It is a strategy that the two major parties have bought into and it avoids what I call “trophy agreements” which have given away the shop—as it were—just for something to hang on the wall and enable us to say that we have an agreement with this or that country. So it is a substantive approach. I think that it is in New Zealand’s interests that we support this bill and I am very pleased that we are able once again to expedite its passage and come together in this House on a near consensus. 
Dr PITA SHARPLES (Co-Leader—Maori Party) 
: 
 When the Maori Party addressed this House at the first reading of this bill we raised the notion that the Treaty of Waitangi statement in the national interest analysis could have been an excellent opportunity to see this bill as a test case for really understanding the implications of the Treaty. We have the unique situation in this Parliament of being flush with members’ bills that place before the House the concept of the principles of Te Tiriti o Waitangi and yet ironically here was an opportunity for the Government to demonstrate leadership about that area which it has overlooked or worse yet actively neglected. 
The national interest analysis included the statement that there is nothing in the agreement that will prevent the Government from fulfilling any obligations under Te Tiriti o Waitangi. How much more proactive it would have been to see the Government honour its obligations instead of the rather pitiful and negative response highlighted there. We could have had a strong statement about the Crown committing itself to being the guarantor and protector of the Maori interest and of the implications that would bring with it for largely unexplored relationships between the two signatories. 
This nation is on the brink of a major change and the conduct of the affairs of the nation must be interpreted in ways in which taonga Maori are actively protected. This bill could have been a starter in exploring even tentatively those implications. Article 2 of the Treaty is relevant in fulfilling the aspirations of Maori to live according to kaupapa or values and tikanga that derive from those kaupapa. But so too is article 3. The guarantee of article 3 the investment in the survival of Maori as citizens of the nation could lead to fresh thinking in all aspects of the policy programme. 
How would that work in the tariff bill? The real impacts for tangata whenua that will emerge from that agreement are to do with investments economic development and employment options that may be adversely impacted upon. Have the officials involved in putting together the agreement understood the likely implications for Maori women who may lose their jobs in the clothing and textile industries? What impact will increased foreign ownership of New Zealand assets and resources by investors from Chile Brunei and Singapore have for tangata whenua? How will the employment and cultural development of Maori be affected by the agreement? Will it have any downstream effects for the embedding of intellectual and cultural property rights? Taking the time to flesh out in more detail the development of mechanisms both legal and policy to protect Maori cultural heritage including matauranga Maori or Maori knowledge is a way of giving life to Te Tiriti o Waitangi as the foundation of our nation. 
 The Maori Party supports the continuing development of international standards to protect the world’s oral traditions intangible cultural heritage and endangered languages and supports the promotion of cultural and linguistic diversity. One would also hope that the Government would be aware of existing indigenous declarations including the Mataatua Declaration on Cultural and Intellectual Property Rights of Indigenous Peoples and be proud of them as a means of distinguishing Aotearoa on the world scene. I note how the performance of the haka at the Melbourne Commonwealth Games is being lauded as one of the symbols that makes us different from the rest of the Commonwealth and indeed the world. 
I have taken the time to give detail to what it would mean to apply treaty principles to the nation-to-nation strategic economic partnership agreement under discussion here as I fear that all too often in this House point-scoring and derision can mean opportunities for learning and challenges are missed. The relationship with Chile Brunei Darussalam New Zealand and Singapore is an opportunity for tangata whenua to be involved in the decision-making process on international trade providing us with a reason to scrutinise trade treaties as to their compliance with the Treaty of Waitangi. It is of vital importance that we open our lines of inquiry about the processes by which international agreements are made and monitor them to ensure our nation’s well-being is protected supported and enhanced. 
As an example of that approach I want to turn to another relationship document the Draft Declaration on the Rights of Indigenous Peoples to show how we need to improve upon our position in respect of international agreements. The Minister of Foreign Affairs recently reported that four factors must be understood about New Zealand’s position on the draft declaration: first it must be consistent with New Zealand law and policy second it must be consistent with existing human rights law third it must protect the rights of all citizens and fourth it must safeguard the territorial integrity and political unity of States as well as the responsibility of democratically elected Governments to govern for the welfare of all of their citizens. That was a fascinating statement of subterfuge which mentions all citizens twice and yet fails to mention the indigenous people: tangata whenua; Maori. The Minister was explaining the Draft Declaration on the Rights of Indigenous Peoples and not once was the word “indigenous” used. 
In defending his statement the Minister explained that the imperatives New Zealand requires in the declaration are legitimate ones for any democratically elected Government. Other States take a similar position on those imperatives including Australia and the United States. Of course I do not need to point out to this House the value or otherwise of comparing the profile of how this nation addresses the status of indigenous peoples with that of how the Australian nation addresses its Aboriginal communities or how the United States addresses its Native American First Nations people. But the question I do want to raise is the bizarre circumstance of a policy about indigenous people that twinks out “indigenous” and replaces it with “all citizens”. Hence we get the situation of a position on New Zealand’s indigenous people that fails to mention them or of a visionless Budget Policy Statement released last May that forgot to identify Maori as part of the citizens of this land or of a foreshore and seabed policy that extinguished the rights of the indigenous people in the interests of all its citizens so that all New Zealanders could have a picnic on the beach. 
When will we become brave enough to be proud of our indigenous people and showcase our distinctive relationship with our First Nations people through Te Tiriti o Waitangi? One has only to look at the Commonwealth Games to understand how critical those relations are with indigenous societies. When Moss Burmester won the 200 metres butterfly final at the pool on the opening night of swimming the haka that the New Zealand team performed in his honour sent ripples throughout the Commonwealth. It has got people talking trying to understand the relevance of the cultural honour accorded through that practice. 
While athletes are competing in the games venue a parallel cultural event entitled the Stolenwealth Games is happening in another part of Melbourne. Thousands of Aboriginal people from around Australia and across the globe have made their presence felt in drawing attention to the ongoing injustices of the Government-enforced destruction of indigenous societies. They are gathering on Bunurong land known as Kings Domain under the banner of the Black GST which stands for genocide sovereignty and treaty. Black GST elder Robbie Thorpe described the event as demonstrating to the world the history of the Commonwealth in oppressing indigenous people across the globe in a common experience of exploitation over generations. 
I raise this issue today as I believe it is always important to look beyond the rhetoric of documents negotiated by officials to see what the situation is for the peoples of the affected communities. If we are to seriously enter into the trans-Pacific economic partnership we must as a first point ensure that the indigenous people of this land are protected and actively involved in the decision making and must concurrently ensure that the indigenous people of Chile and of other nations in the economic partnership are likewise involved with their particular interests taken care of. A trans-Tasman agreement say with Chile could be beneficial if it helped to facilitate economic and cultural linkages between Maori and Chile’s indigenous people including the Mapuche from mainland Chile as well as the Rapanui of Easter Island who have historical linkages with Maori. 
The Maori Party urges all New Zealanders to become better informed about the Treaty of Waitangi including the rights and obligations of both the Crown and Maori and about the rights of indigenous peoples under international law. We need to seek constructive dialogue rather than divisive statements from our politicians. We need continued tolerance and enthusiasm on all sides. Until we are in that position it may be better just to sort out our own backyard. 
A party vote was called for on the question  
That the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill be read a second time. 
Ayes 111 
New Zealand Labour 50; New Zealand National 48; New Zealand First 7; United Future 3; ACT New Zealand 2; Progressive 1. 
Noes 10 
Green Party 6; Maori Party 4. 
Bill read a second time.