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Speech: Katene - Free Trade Area Bill

ASEAN Australia – New Zealand Free Trade Area Bill
Tuesday 28 April 2009
Rahui Katene, MP for Te Tai Tonga

The figures at the core of this Bill are staggering.

We are talking about a free trade area with approximately 566 million people, a combined gross domestic product of US$19 trillion and global trade of US$1.7 trillion.

It’s not easily ignored.

This region represents one of the most economically dynamic markets in the world. Even in the Aotearoa-ASEAN relationship, the trade in exports has grown an impressive 24% per year over the last three years.

This is certainly a massive undertaking.

The Agreement signed at Hua Hin in Thailand on 27 February this year didn’t just formalize a commitment between Australia and New Zealand.

The agreement also involves Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Viet Nam.

Amongst the key guiding principles of the Agreement, is the objective to move towards deeper economic integration through progressive elimination of all forms of barriers to trade in goods, services and investment.

It is designed to inspire and promote the facilitation of trade and investment, as well as measures of economic cooperation.

It is also intended to be comprehensive in scope, covering trade in goods, services and investment.

This all sounds good in principle; even more promising for practice.

But here’s the thing.

The economic benefits of international trade agreements need to be balanced with consideration of our own local, regional and national social progress and environmental enhancement.

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The Maori Party’s mantra is that we support Fair Trade Agreements as opposed to Free Trade Agreements.

So what do mean by fair rather than free?

The Fair Trade Association of Australia and New Zealand works with the following definition:

“Fair Trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade.
It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers - especially in the South”.
This is a big difference to what we would expect of conventional international trade.
This Bill provides for the application of preferential tariff rates for goods manufactured or produced by AANZFTA parties, and for the ability to set different tariff rates of duty for such parties.

It provides for the application of transitional safeguard measures to be applied on imports originating from AANZFTA party countries.

And it will enable the NZ Customs Service to designate certification bodies authorized to issue New Zealand certificates of origin for goods exported to AANZFTA party countries.

At its very core, the Agreement includes investment, intellectual property rights, competition policy, financial services, and tele-communications.

There’s nothing wrong with that.

But alongside conventional concepts of free trade we in the Maori Party want to also see demonstrable evidence of fair trade as a just and environmentally sustainable alternative.

We want to see attention paid to labour and environmental justice issues and human rights.

The fair trade movement would enable items to be produced with only a minimal impact on the environment – the cost of environmental sustainability being a key consideration in the equation.

But importantly while there are clearly advantages to exporters, if a fair trade framework was applied, it also enables an opportunity for both producers and consumers to challenge unfair trading practices.

It is, at its heart, about balancing the profits and benefits of international trade with the strengths of grassroots development and economic justice.

And yet, in this ASEAN FTA, just as with the China-NZ FTA, the treaties on labour and the environment are not sufficiently robust to guarantee minimum standards or commitments to establish minimum standards on labour issues or environmental standards.

In terms of labour law, in further removing tariffs on imports into NZ, NZ manufacturers and businesses are further exposed to competition that they may be unable to match given the differences in wages between NZ and ASEAN.

But of course it is not just at home that we need to be thinking of the impacts of this new ASEAN Australia – New Zealand Free Trade Area Bill.

We need to also be considering the likelihood of low pay, unsafe working environments, poor living conditions and exclusion from the decisions that affect the lives of the populations living in the 10 member countries of ASEAN.

How will this free trade agreement make any difference to their poverty and suffering? What opportunity have they had to participate in the decisions around this agreement? How does it assist country producers to escape the cycle of poverty?

Thinking of the second issue, the environment, it is arguable that New Zealand’s current environmental laws are sufficient to protect the natural estate.

As we know, Maori have raised concerns with the HSNO Act and genetic experimentation, the Conservation Act 1987, the Crown Minerals Act 1991, and fisheries legislation – so we are hardly in a position where we can stand strong about our environmental laws.

Another of the measures introduced in the Bill is the undertaking that there in this nothing in this agreement that prevent the New government from taking any measure it deems necessary to accord more favourable treatment to Maori given Treaty of Waitangi obligations.

This is interesting wording, and is clearly not sufficient to ensure the government will act in accordance with such obligations.
And if recent events are anything to go by, we have every reason for caution.

Just yesterday, sitting with the Select Committee reviewing the Emissions Trading Scheme, we were told the scheme is unfair on Maori who will reclaim 600 hectares of pre-1990 forests in Treaty settlements.
Under the terms of the Emissions trading scheme, landowners are liable if they deforest more than 200 hectares of pre-1990 forest land.
The Climate Change Iwi Leadership Group told the committee that the bulk of Maori forestry - is pre-1990.
And of course the Auckland supercity situation, is even more conclusive evidence that Treaty of Waitangi obligations are easily and quickly discarded when the rule of the majority interest prevails.
Finally, I believe the timing of this Bill coming into Parliament in this week, is particularly significant.

This weekend, New Zealand starts a Fair Trade Fortnight, symbolised by the Go bananas campaign.

As a country New Zealand imports the highest per capita amount of bananas in the world. But the majority of banana plantation workers are unable to earn enough to live and support their families, some earning less than three dollars a day.

So it is the humble banana that I have been thinking of when we think local costs of production in contrast to the corporates who dominate the global banana trade.

Will the Association of South East Asian Nations offer a better deal for producers? Will there be security of long term contracts; will we see an investment in local community development?

How will working conditions improve as a result of the agreement? Will there be any changes made to achieve fair and stable prices for produce? Will there be knowledge acquisition of a scale necessary to compete in the global economy?

With all these questions in our mind, we are unable to vote in support of this Bill.

ENDS

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