“Bloody shame” if TPP doesn’t go ahead says Tim Groser

New Zealand isn’t in some type of trade crisis if the TPP doesn’t go ahead says New Zealand’s Ambassador to the United States Tim Groser.

“What I’d say to New Zealanders is if TPP doesn’t happen, we have lost a major opportunity. But we were never betting the ranch on this. We paid the mortgage off on the ranch decades ago,” says Mr Groser.

“We were, to continue the metaphor, counting on TPP to build an extension to the ranch. So I don’t think New Zealand is in some type of trade crisis or anything even remotely approaching it if TPP doesn’t go ahead. It’s just going to be, ‘What a bloody shame that was.”

Mr Groser also told Q+A’s Corin Dann that he would attend the President’s inauguration along with other ambassadors.

“I’ll go along there and put on a big smile for New Zealanders. And then I will take whatever opportunities that I have to meet him. They will likely be ceremonial. An ambassador does not call on the President of the United States.”

Please find the full transcript attached and the video link here

Q + A
Episode 36
Tim Groser
Interviewed by CORIN DANN

GREG After a 2am finish at Trump Tower on election night, political editor Corin Dann and his crew got on an early morning train to Washington, to DC, where ambassadors from all over the world were absorbing the news of a Trump presidency. Our ambassador, Tim Groser, now starts the job of forging New Zealand’s relationship with the new Trump Administration. Corin Dann asked him what his approach will be.

TIM I think the formal position is crystal clear. The Prime Minister’s essentially said this. Let me just put it in my own words. I mean, we, as the New Zealand government, whether it’s been a Labour-led or a National-led government, always established the best possible constructive relationship with governments in control of their country, even when they’re dictatorships as the only way to defend New Zealanders’ interests, and this is the elected president of the most important democracy in the world, so it’s not even a serious question that we will do anything other than now start to build our linkages with the new administration.

CORIN What about Donald Trump, though? He has no experience as a politician. How do you deal with that? He also comes having run a pretty divisive campaign, having said some pretty awful things, and a lot of New Zealanders are very concerned about it. How does New Zealand now proceed in its dealings with Mr Trump?

TIM Well, we will approach that professionally, obviously. We will wait and see how this plays out. I happen to know quite well the current US ambassador in China, Max Baucus — great senator — and I dealt with him when I was Minister of Trade a lot. And, you know, Max obviously has been put right on the spot. ‘What about this 45% massive tariff against China? Is it going to be global trade war?’ And Senator Baucus has said exactly what you think. ‘Look, a lot of things are said in campaigns. Let’s just see how this plays out. We have a very important relationship with China, etc, etc.’ I think it’s a metaphor for a lot of these things. Of course, some very extreme things were said in this campaign. We’re well aware of them, and I could give you a plausible, I think, informed opinion of what would happen if they tried to create a trade war with China, withdraw from the WTO, withdraw from the Paris climate change agreement. The question is…I don’t think it’s, ‘Will Mr Trump as president do this?’ I don’t think it’s a binary yes/no thing. I think it’ll be a question of how far will he move America first? You know, a very aggressive American posturing in these different theatres. And I don’t know the answer to that, so I’m going to be— I’m not by nature very cautious, but I am going to be on this occasion very cautious.

CORIN Well, let’s look at one of those issues — the Trans Pacific Partnership Agreement. Donald Trump has made it very clear he does not like it. Is that it? It’s all over?

TIM I think the Prime Minister prior to this election result last night made it clear that already it was getting very difficult and a victory by Mr Trump would make it doubly so. But for precisely the reason I’ve said, that I’m going to be extremely cautious and conservatives. I’m not going to get out ahead of the political markets. This afternoon I’m going down to see one of the United States’ — I suppose the world’s — most influential business lobbyist, who is a Republican, and I’m going to be asking that question. So I’m going to be pretty discreet, but this is now looking very difficult.

CORIN The thing is if he is going to do trade deals, he’s made it very clear he wants far better deals for America. Does that mean that New Zealand is now way back down the pecking order?

TIM What I’d say to New Zealanders is if TPP doesn’t happen, we have lost a major opportunity. But we were never betting the ranch on this. We paid the mortgage off on the ranch decades ago by establishing these trading platforms with Australia through CER, with China, with Taiwan, with Korea, South-East Asia, and we’ve got others under negotiation. We were, to continue the metaphor, counting on TPP to build an extension to the ranch. So I don’t think New Zealand is in some type of trade crisis or anything even remotely approaching it if TPP doesn’t go ahead. It’s just going to be, ‘What a bloody shame that was.’

CORIN Yeah, but that’s significant, though, isn’t it?

TIM Oh, it is.

CORIN Because if New Zealand becomes less intertwined with the United States, is it going to have to now shift even more into Asia?

TIM Well, on the political front, the answer to that is very clear — no. We have right now as we are talking — it will be after this programme appears — the Secretary of State and former presidential candidate — got very close to it — Mr Kerry in New Zealand right now having talks with our government. Then in mid-November we have this enormously important and emblematic visit of the ship to New Zealand for the first 30 years. So on the political security, intel side, our relationship with the United States is literally in the best shape. This is not going to change that. If anything, you’d argue that a more muscular emphasis on ‘Who are America’s real friends?’ might even augment it, but we don’t need to. On the economic side, well, if TPP did fall apart, we’d have to reappraise our options. But when you say may get more dependent on Asia, we’ve also got a play going off into the Pacific Alliance with Mexico, Peru, Chile and Colombia. That would take on an entirely different significance for New Zealand. We’ve still got the EU FTA under the early stages of negotiation. I’ve called it in the past, when I was in the government following an Asia-first but not an Asia-first-and-last strategy. And I don’t think this changes that.

CORIN But the bigger worry is that if Donald Trump is protectionist in his tone and the way he runs the United States, that it spreads and that other countries do retaliate.

TIM Absolutely.

CORIN Okay, not a trade war necessarily, but perhaps we start to see the prospect of more free trade deals fall over, countries retreat, and there’s retaliation. That’s a huge worry for us, isn’t it?

TIM That is the concern. How far does this go? I mean, do I really believe that he’s going to rip up the NAFTA and trade agreements, walk out of the WTO? In my heart of heart, I cannot believe that, because it would cause so much damage to the United States, there would be so much pushback from the sort of businesspeople I’m going to see this afternoon. But, you know, we can take for granted a little bit too easily some of the benefits of the open political economy that we’ve created since the war, and there’s every reason to be rational and very, very cautious about defending that in the face of massive opposition from both the far right and the far left in Europe and the United States.

CORIN What about the geopolitics of Donald Trump’s victory. He has made it clear that he wants allies, like Japan, for example, to pay for their own defence and military. What sort of an impact will that have for a country like New Zealand.

TIM Well, there are various ways of committing political suicide. One would be to answer on camera your question directly. I’m not prepared to talk about this in the bigger global strategic sphere. But for New Zealand, we’ve got a great story to tell. I mean, honestly, the reception that I’ve had since coming up here since leaving politics here in terms of our contribution to training the Iraqi soldiers who are now trying to get in and eradicate ISIS in Mosul, towards the reboot of defence expenditure and the increased emphasis on intelligence — not just against terrorists but against drug thieves and all manner of undesirables. Look, we’ve got a great story to tell. I believe that our Prime Minister, our Minister of Foreign Affairs, our Minister of Defence have got a great story to tell. I don’t think we’ll come under pressure from that ground. But the bigger thing I’ll stay silent on.

CORIN Well, we spoke to Robert O’Brien,…

TIM I know him, yep.

CORIN …former policy adviser to Mitt Romney and others, and he suggested that it was likely that New Zealand would come under some pressure to increase its defence spending, perhaps not explicit. But is that the type of thing New Zealand may face under a Donald Trump presidency?

TIM That would be a logical inference, and I know Robert, to draw from the comments. But since the government has announced a $20 billion increase in expenditure, which I’m not sure Robert would be fully on top of, we’ve got a very good response, if that’s the ask … We’ve got a good tale to tell.

CORIN What do you say to those New Zealanders who may now be thinking, ‘Why do we have to have this relationship with the United States? Why do we have to deal with Donald Trump?’

TIM Well, there may be those New Zealanders, there’s always been a hard, small core of people—

CORIN But it might be bigger now.

TIM It could be bigger. We’ll wait and see how that plays out. But, you know, our polling around the issue of the ship visit, for example, shows incredibly positive. Yep, there might be a little bit of fall-off. We’ll wait and see.

CORIN On a personal level, do you know Donald Trump?

TIM No.

CORIN How do you envisage New Zealand getting into the Oval Office? Do you think there will be a big, long queue?

TIM I shall attend the inevitable invitation that I and other ambassadors receive to an inauguration. I’ll go along there and put on a big smile for New Zealanders. And then I will take whatever opportunities that I have to meet him. They will likely be ceremonial. An ambassador does not call on the President of the United States. But clearly the Prime Minister will be seeking at some stage, I imagine, visits or discussions at international meetings with him. My role will be down the food chain to try and establish relationships with his senior advisers. It’s very difficult at this stage to start targeting, because, actually, the gentleman you mentioned is one of the very few foreign policy experts who have not signed a letter saying, ‘I’m having nothing to do with Mr Trump if he becomes the president.’ So we’re doing a lot of analysis now, along with other embassies, of course, with a lot of advice from people in this town who are experts. ‘Who are we going to be dealing with?’

CORIN What do you make of Donald Trump? I mean, do you believe the rhetoric? Is he the populist? What is he?

TIM Oh, I’ll pass on that.

CORIN But you’re going to have to deal with him. You’ve got to get inside his head, don’t you, because you’ve try and anticipate how he’s going to think.

TIM I’ll deal with him professionally. Look don’t forget, he is a democratically elected politician. I’ve had to deal, when I was ambassador 25 years ago, with Suharto, who was an authoritarian elected by nobody. So I’m used to dealing with people who are much less mandated by their people than Donald Trump.

CORIN I just wonder whether for New Zealanders who hear the rhetoric and get very scared, do you think there will be a moderation; that perhaps the moderation that you usually see in a primary race, now that he’s president—

TIM Yes, of course, I expect there to be a moderation, and we’ve already seen that in his acceptance speech. How far this goes and for how long is something we’ll have to see, but, of course, there will be a moderation.

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