National Government loses $5 billion-plus fig leaf for TPPA
National Government loses $5 billion-plus fig leaf for
‘The fig leaf of over $5 billion in gains to the New Zealand economy from the Trans-Pacific Partnership Agreement has been stripped away’, said Auckland University law professor Jane Kelsey, a long-term critic of the proposed TPPA.
The Sustainability Council of New Zealand has just released an evaluation of the study by the Washington-based Peterson Institute for International Economics that Prime Minister Key and National ministers have relied on.
The review, led by Wellington economist Dr Geoff Bertram, concludes that the Peterson Institute’s study has greatly exaggerated the projected gains and ignored the financial and intangible costs. Only about one quarter of the projected gains are backed by a credible economic methodology and the Peterson Institute ignores the many fiscal and regulatory downsides.
On the information available, they doubt there is a net benefit to New Zealand from the TPPA.
Their analysis is consistent with the criticisms that Australian Productivity Commission made in 2010 about similar studies on the Australia US free trade agreement and other bilateral deals.
‘Several years ago trade minister Tim Groser dismissed the value of such modelling, and predicted “wearily” that a study would emerge to claim mega-gains for the TPPA’, Jane Kelsey observed.
‘Despite Groser’s scepticism, his own government has used the Peterson Institute report to rally support for a deal that many New Zealanders see as toxic.’
‘When the Prime Minister started producing ever-higher projections, I speculated some fancy footwork was going on,’ Kelsey said.
‘We are indebted to Geoff Bertram and the Sustainability Council for explaining the technical reasons why these figures have no credibility.
‘Politicians know that ballpark figures that promise enormous gains make headlines, even if they lack substance. That now has to stop’.
Professor Kelsey reiterated
the call for a full and independent cost benefit analysis of
the monetary costs and benefits, and the constraints on New
Zealand’s sovereignty, before any deal is signed.