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NZ MIA annual meeting - Jim Sutton Speech

Hon Jim Sutton Speech Notes

NZ Meat Industry Association annual meeting, Wellington

Chairman Bill Falconer, executive director Brian Lynch, ladies and gentlemen: thank you for the invitation to speak to you today.

It's good to come to this conference again this year in the knowledge that on the international trade front, we have made progress in a number of key areas.

Chief among these of course, is the sucessful conclusion to our WTO dispute with the United States on lamb.

>From November 15, our lamb exports to that important market will no longer be subject to quota. The United States Administration deserves credit for bringing their illegal measure into conformity with World Trade Organsiation rules. Despite the frustrating delays the DRP entails, I always held to my personal belief in the United States as a nation that fundamentally respects due process.

I hope the Canadians will do likewise before long in respect of their illegal measures on dairy exports.

The lamb outcome represents a significant achievement on the part of trade negotiators and the industry, who worked very closely together over several years to get us to this point.

As your industry leaders know, in the past few days we have received advice from the United States that the normal tariff will apply to all exports arriving after midnight on November 14, and not just those shipped after that day. This is a detail into which New Zealand put a lot of effort and we appreciate the United States willingness to accommodate us in this regard.

As well as winning trade disputes, we have paid attention to pushing for a new round of multilateral trade negotiations. I'll say more about this later.

And we are now set ? at last ? to welcome China and Taiwan into the World Trade Organisation, thereby making it truly a world trade organisation.

Whether through upholding the rules of international trade, launching a new round of negotiations aimed at reducing or eliminating barriers to trade, or confirming new member countries' attachment to a rules-based system ? all of these developments are of direct benefit to your industry, which is global in outlook.

Whether we like it or not, that makes us international citizens. What happens elsewhere in the world matters to us.

I'm sure that, like me, you were shocked to the core by the events in New York, Washington DC, and Pennsylvania on September 11. The deliberate taking of innocent lives on such a scale, in such a setting, at a time of peace, was utterly horrifying.

New Zealand stands firmly alongside the United States in condemning the actions of terrorists. We have pledged our support fairly and squarely to the United States to combat terrorism and to bring the perpetrators of these atrocities to justice.

Our response has been defined, not by treaty, but by the horror felt by all New Zealanders and by recognition of what New Zealand and the whole civilised world have at stake.

Within three hours of the tragedy, New Zealand had sent a message of sympathy and an offer of help to the United States.

Since then, attention has turned to forging a global response to terrorism in an effort to safeguard the freedom of the international community. New Zealand is fully part of this and you can expect the Prime Minister and the Government to devote considerable effort to this in coming weeks.

Some have linked this terrible tragedy with the effects of globalisation. They suggest the proper response is to retreat inward, to build a fortress around ourselves, and to lessen our dependence on international trade and tourism.

They overlook that New Zealanders, since the earliest times, have been a people reaching out far beyond our shores.

They ignore that globalisation is not something that may happen. It is not something that can be avoided. It is something that has happened already.

Last week, after the terrorist attacks, United States Trade Representative Robert Zoellick issued the following statement:

"Let there be no misunderstanding: the United States will continue to advance the values that define this nation - openness, opportunity, democracy and compassion. Trade reinforces these values, serving as an engine of growth and a source of hope for workers and families in the United States and the world. Trade is particularly vital today for developing nations that are increasingly relying on the international economy to overcome poverty and create opportunity.

"While we will take every possible step to ensure security, it is important that the World Trade Organization meeting in Doha proceed so that the world trading system can continue to promote international growth, development, and openness."

Today, ladies and gentlemen, I want to back those comments by Bob Zoellick and to state clearly our Government's willingness to work with the United States to make that vision a reality.

We now have 47 days till the Doha meeting. I am hopeful that meeting will launch a new round of multilateral trade negotiations. Those negotiations will include agriculture and food.

In the almost two years since the failure at Seattle, there has been a huge amount of diplomatic and ministerial work around the world, discussing and assessing the chances of getting a new round underway.

There is a consensus emerging.

People see the need for a new round. They are aware that to make progress, nations have to show their people they have had a win. That requires trade-offs ? for example, we give the Europeans something in return for increased access to their agricultural markets.

In a perfectly logical world, a sufficient "something" would be more choice of quality food products for their consumers, at keener prices. In the world as it is, something more will be required.

The consumer may be king in the market place for goods and services, but consumers are routinely trampled by vested interests in the world of diplomacy and trade negotiations.

Most people, however, agree agriculture and food must be included in the proposed round.

The meeting of the Cairns Group of agricultural trading nations in Uruguay earlier this month was an important part of the build-up towards a new round of world trade negotiations.

The three-day meeting at Punta del Este saw the Cairns Group re-affirm its unity of purpose in the build-up to a possible new world trade round.

I was pleased New Zealand was able to make a very effective contribution to bringing together the various views of what is a very diverse group of nations into a coherent position which will make us collectively a key player in Doha and the next round.

New Zealand has played a significant role in the 15-year history of the Cairns Group, and this continued at the Uruguay meeting. Our voice was heard clearly at Punta del Este.

Members of the Cairns Group were clearly aware that there were then only 65 days till the World Trade Organisation meeting in Doha, Qatar, and were very focused on the need to launch a round of world trade negotiations.

The communique released at the close of the meeting was explicit about the need for further agricultural reform.

The time is well overdue to bring agriculture and food fully under the World Trade Organisation so that producers can compete fairly on the basis of their comparative advantage.

Cairns Group ministers expressed concern that total Organisation of Economic Co-operation and Development nations' support of agriculture was running at almost US$1 billion a day, and that protection provided by both tariffs and non-tariff barriers, including unjustified sanitary and phytosanitary (plant and animal health) measures, remained very high.

The ministers emphasised their concern over the loss of momentum in the reform process and reaffirmed the Cairns Group's commitment to establishing a fair and market-oriented agricultural trading system.

The group is more united and determined than ever to push for agricultural reform.

All New Zealanders, and especially those in the meat industry, could benefit from a new round.

A recent study by Standards NZ found that non-tariff trade barriers, particularly on our food products, cost us $1 billion a year. That doesn't include opportunity costs, which would be considerably greater. We have a lot to gain from global agricultural trade reform.

As well as freeing the world trading system of distortions, continued agricultural trade reform would significantly help developing nations.

Many of the developing nations at this Cairns Group meeting spoke of their anger at how trade barriers prevent their products being sold in the world's richest markets. And how, at the same time, export subsidies for farmers in those rich industrialised countries result in surpluses from those countries selling in developing nations' markets and undermining the value of the local produce.

For New Zealand, those same export subsidies harm the competitiveness of our agricultural products in third markets.

There is a lot of work to be done from now till the Doha meeting, and New Zealand will be fully involved in that work.

But I hasten to add, it's not just something we can leave to diplomatic and agricultural officials or to politicians. Business has a role to play here too ? not only in telling my Government exactly where you need efforts to get greater access targeted. You can also explain to our fellow citizens in New Zealand how trade helps you, your employees, and the country as a whole.

I'd like to congratulate Brian Lynch here for his role in tackling this. Brian is chairman of the newly-formed Trade Liberalisation Network, an organisation being set up to explain exactly how trade helps New Zealand. He's stealing one of my talented staff to get the network up and running, but I guess I can forgive him that.

Ladies and Gentlemen: now more than ever before we must repeat again and again the message that trade is essential for New Zealand. We simply cannot affordably provide from our domestic resource base everything our citizens want and need.

We have an absolutely essential need to trade the things we produce well here for things other countries produce well. Frankly, any New Zealander who cannot understand that really must have rocks in their head.

Now is not the time to retreat from the international trading system or from trying to improve the way it works.

Rather, in the face of challenges to open societies everywhere and to the freedoms we have come to enjoy, we must redouble our efforts to extend the benefits of trade liberalisation to all who are excluded.

Trade and the rule of law have the potential to expand and improve living standards for all. That's what my colleagues and I in Government are working hard for.

Thank you.


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