Lobbies welcome TPP

Business lobbies, wine growers and the country's meat sector have welcomed the Trans-Pacific Partnership trade and investment agreement, which left Fonterra cold after prolonged negotiations wrung only small, slow access to some of the world's most protected dairy markets.

Early responses to the deal announced overnight in the US have been mixed, with business lobby groups touting the benefits lower tariffs will bring to local industry and the First Union calling it a "betrayal."

New Zealand Winegrowers anticipates the deal will help the industry reach its target to lift exports to $2 billion by 2020 from the current $1.46 billion in foreign sales, while Beef + Lamb New Zealand and the Meat Industry Association say the agreement will "have a significant impact on the competitiveness of our exports in TPP markets" and estimates it will deliver an additional $72 million a year in tariff savings for beef and sheepmeat once it's fully implemented.

While meat and wine were relatively happy with the outcome, Fonterra says it is "very disappointed" at the deal falling short of an original goal to eliminate all tariffs over time, though there are some useful gains for the country's biggest exporter.

Industry lobby group Business New Zealand say the TPP opens access "to an influential group of trading partners in the pivotal Pacific arena, including the US and Japan," the country's third and fourth biggest export destinations respectively.

"While we did not get all we wanted out of dairy access, sitting on the side-lines was not an option," Business NZ chief executive Phil O'Reilly says.

"If New Zealand wants to broaden its economic base and move away from an over-reliance on selling commodity products to the world, we needed to secure a high quality deal that gives greater market access to both goods and services exports and one that encourages investment."

The TPP knits together some 40% of the global economy, having begun nearly a decade ago as a four-way negotiation involving just New Zealand, Singapore, Brunei, and Chile. Since then, the US, Japan, Canada, Mexico, Australia, Vietnam, Malaysia, and Peru have joined, with the initiative now widely described as a legacy project for outgoing US president Barack Obama.

The parliaments of all signatory countries will need to pass legislation to bring the newly minted agreement to fruition, a process that could take two or more years and is likely to spark impassioned debate in many countries. Significant opposition to the deal has emerged, in part because of the secrecy under which it was negotiated.

Industry lobby Internet New Zealand says it will participate in legislative process, saying announcements to extend copyright terms to 70 years from 50 years is an area it has been concerned about, and shouldn't be subject to closed-door negotiations.

"No definite conclusions on these, or any other issues, can be reached until the detail of the TPPA is made public," chief executive Jordan Carter says. "We hope our concerns - and those raised by other technology sector organisations - have been listened to."

The deal is slated by First Union, saying "even on the government's primary metric for success - dairy access - its fallen remarkably short. And the investor state dispute settlement provisions, where investors can seek remedies against government regulation to protect their investment, undermines New Zealand's sovereignty."

RAW DATA: Ministry of Foreign Affairs and Trade's summary of the Trans-Pacific Partnership (PDF here)

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(BusinessDesk)