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Which of Labour’s trade policies will the PM pursue

Which of Labour’s trade policies will the PM pursue in Europe?

‘As the Prime Minister heads to Europe, with the proposed trade deals with the European Union and Britain at the top of her agenda, which of Labour’s trade policies she is going to pursue?’, asks Auckland University law professor Jane Kelsey.

‘Is it the kind of traditional trade and investment deal that Labour and New Zealand First have criticised, then signed up to with the Trans-Pacific Partnership Agreement and in revisions of the China and Singapore FTAs?’

‘Or will it be the new “inclusive and progressive” strategy that Trade Minister David Parker is about to launch consultations on, but which does not yet exist?’

Professor Kelsey is herself in Europe and has been discussing the proposed negotiations with politicians, officials and activists in Britain and the European Union.

Both Britain and the EU see a deal with New Zealand as relatively easy and hope to fast track it. Informal talks began some time ago under National government, presumably following the TPPA-style model that the government says it wants to change.

‘A quick outcome assumes there is common ground on most issues, which in turn implies a traditional-style free trade and investment deal, not the significant rethink the trade minister has promised. If so, the minister’s consultation process would be sunk before it even starts.’

Professor Kelsey notes that the EU is expected to finalise its mandate for negotiations around 22 May and publish it immediately. The New Zealand government will face pressure to do the same.

‘There could be common ground with New Zealand over investment’, Kelsey said. The EU will want to run the trade and investment negotiations in parallel, with separate agreements, because of a split responsibility between the EU and Member states.

It is likely to promote a two-tier standing investment court in place of the current ad hoc system of investment tribunals to hear disputes, as it did with Canada. A decision on the constitutionality of that is due next year.

‘The problem for our government is the EU’s investment court system is old wine in new bottles: investors take disputes against states in offshore tribunals to enforce rule that are biased in favour of foreign investors and constrain government’s regulatory sovereignty’.

‘That’s not what the government promised New Zealanders, but have yet to deliver. A positive step to build confidence would be for our government to draw a red line in its negotiating mandate that says no investment agreement at all. That would give the Minister some credibility to begin negotiating a genuinely new trade platform’.

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