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Cablegate: Trade Minister On Tpp - the Hour Is Not yet Here

VZCZCXYZ0002
RR RUEHWEB

DE RUEHWL #0275/01 2610249
ZNY CCCCC ZZH
R 180249Z SEP 09
FM AMEMBASSY WELLINGTON
TO RUEHC/SECSTATE WASHDC 0137
INFO RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHBY/AMEMBASSY CANBERRA 0038
RUEHC/DEPT OF AGRICULTURE WASHINGTON DC
RUEHDN/AMCONSUL SYDNEY 0032

C O N F I D E N T I A L WELLINGTON 000275

NOFORN
SIPDIS
NOFORN
STATE PASS TO USTR/BISBEE
DEPARTMENT OF AGRICULTURE - RALPH BEAN

E.O. 12958: DECL: 2019/09/18
TAGS: ETRD ECON PGOV PREL NZ KGHG EAGR
SUBJECT: Trade Minister on TPP - The Hour Is Not Yet Here

CLASSIFIED BY: Robert Clarke, Charge d'Affaires; REASON: 1.4(B), (D)

1. (C) Summary. During a September 16 introductory call on Tim
Groser, Minister for Trade and the Associate Minister for Climate
Change Issues and Conservation, the ChargC) emphasized his desire to
help the bilateral relationship continue on an upward path. Groser
assured that he also wanted to see the relationship move forward on
all fronts and that the ChargC) would always have full access to his
office. Groser volunteered his understanding that the moment for a
U.S. trade agreement with New Zealand was not yet at hand, and he
expressed his firm belief that the U.S. Administration would move
forward on expanding multilateral trade when the timing is right.
Turning to climate change, Groser said that New Zealand is in a
unique position as the only developed country with the largest
proportion of its greenhouse emissions coming from the agriculture
sector. As such, it can play an "intermediary role" in bringing
developing countries to the climate change discussion since many of
them face similar challenges. Groser called for a vast concerted
effort by all countries to develop technology that will reduce
agriculture-related emissions, and noted New Zealand's keen
interest in partnering with the U.S. Department of Agriculture on
this endeavor. Groser also outlined some political thorns and
anti-American sentiments that might hamper any potential trade
negotiations with the U.S. End summary.

Free Trade with NZ - The Hour is Not Yet Here

---------------------------------------------

2. (SBU) Groser raised the topic of the Trans-Pacific Strategic
Economic Partnership (TPP) and emphasized he understood that the
time was not yet ripe for Washington to move forward. He added
that he had cautioned his Vietnamese and Peruvian counterparts that
it would be "foolish and even counterproductive" to apply
diplomatic pressure on the USG in an attempt to accelerate the time
schedule beyond that dictated by the White House's internal
process. Groser expressed his confidence that the U.S.
Administration is fully interested in moving forward on
multilateral trade at the right time. However, he said it is
essential for the United States to eventually join the TPP for the
agreement to be useful - "a TPP without the U.S. is like a meal of
steak and potatoes without the meat dish."

Shifting the Focus of International Trade to Climate Change

--------------------------------------------- --------------

3. (SBU) Turning to the subject of climate change, Groser
explained that the Kyoto Protocol put New Zealand in a unique
position as only the developed country (Annex 1 country) with the
largest proportion of its greenhouse gases coming from agriculture
- 49 percent. The size of New Zealand agriculture emissions is a
function of the size of its agriculture output. (Note: About 90
percent of the food New Zealand produces is exported. End note.)
Hence, for New Zealand, reduction of its carbon footprint is
closely tied to income security. Many developing countries have a
carbon footprint similar to that of New Zealand - one that is more
heavily composed of ag-related greenhouse gases. Greenhouse gas
emissions from agriculture average 27 percent for all developing
countries; for Brazil it is 58 percent; and for India it is 21
percent. For developing countries, however, reducing their carbon
footprint becomes a matter of food security.

4. (SBU) According to Groser, moving forward on a successor
agreement to Kyoto must include the participation of developing
countries, and the international community must come to terms with
ag-related greenhouse gases. The issue must be dealt with in a way
that does not force developing countries to choose between food
security and greenhouse gas reduction. Otherwise, developing
countries will have no choice but to opt out. The key, according
to Groser, is a massive, coordinated effort between countries to
create technology aimed at reducing ag-related greenhouse gas
emissions.

Strong Interest in Partnering with USDA on Research

--------------------------------------------- -------

5. (SBU) Groser emphasized that he is keenly interested in forming
an alliance with the U.S. Department of Agriculture (USDA), noting
his previous discussions with USDA on the matter. He said he would
like to see USDA play a huge role in climate change, especially in
the development of new technologies that can reduce ag-related
greenhouse gas emissions. For its part, New Zealand, as a
developed country with the preponderance of its emissions coming
from agriculture, can bring its credibility to the table in climate
change discussions with developing countries. According to Groser,
New Zealand wants to play an "intermediary role" in the effort and
remind the world, "don't forget agriculture."

The Politics of Supporting Free Trade with the U.S.

--------------------------------------------- ------

6. (C) After asking his two DFAT advisors to leave the room,
Groser opened what he termed a frank political discussion. He
outlined the political landmines that might befall any trade
discussions with the U.S. He described Opposition Leader Phil Goff
as a man under "extreme pressure." Goff himself is pro-U.S. and
moderate, but there is an anti-U.S. component "at the fringe of the
left wing of the Labour Party," which seeks to exploit
opportunities to replace him. Bringing the U.S. into the TPP could
magnify anti-U.S. rhetoric. If Goff remains opposition leader, he
should be able to contain this potential. However, if Goff fails
and New Zealand is in the middle of negotiations with the U.S., you
could suddenly see a "real anti-American element spring up."
Groser emphasized that the New Zealand Government is trying to
manage this process in a "mature way" so the opposition will be
brought into the process early on to seek their buy-in. Groser,
however, expressed his confidence that Goff would remain at the
head of the Labour Party and as opposition leader going into the
next election.
CLARKE

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