NZDF General discussion thread

[MrConservative]

NZ - UK FTA signed.

UK agrees free trade deal with New Zealand

The government says consumers and businesses will benefit from deal, but it is unlikely to boost growth.

www.bbc.com

The increased benefits will likely emerge over the medium to longer term. Another step towards the UK becoming part of the CPTTP.

If the UK does get acceptance into the CPTTP, which has been greatly pushed by Japan in particular, it will put pressure on US trade competitiveness leading it to join as staying out of the tent will become more burdensome. With the UK in the CPTTP, Japan will have no qualms refusing China's recent joining murmurs.

 

[ngatimozart]

NZ - UK FTA signed.

UK agrees free trade deal with New Zealand

The government says consumers and businesses will benefit from deal, but it is unlikely to boost growth.

www.bbc.com

The increased benefits will likely emerge over the medium to longer term. Another step towards the UK becoming part of the CPTTP.

If the UK does get acceptance into the CPTTP, which has been greatly pushed by Japan in particular, it will put pressure on US trade competitiveness leading it to join as staying out of the tent will become more burdensome. With the UK in the CPTTP, Japan will have no qualms refusing China's recent joining murmurs.

Japan won't be the only one thinking of black balling it. I would think that Australia would be top of that list. It may also make Taiwan's entry into the CPTPP easier as well.

 

[KrustyKoala]

The timing of China's application (Right after the AUKUS announcement) make it seem like a reactive decision rather than a proactive one. It must be clear to the Chinese government that if they want to wreck the CPTPP, which was and still is meant to America's answer counter balance Chinese economic dominance in the region, than they had to move.

I doubt China failed to notice that the AUKUS members all have interests in the continuation and expansion of the CPTPP. If China applied after the UK had joined they would likely be vetoed (with good reason) and the ability to coerce/retaliate the UK would be limited as they do most of their trade with the EU and U.S. If the US rejoined than nations that once readily considered the TPP: Philippines, South Korea, Thailand, Indonesia may flock to the agreement increasing US economic influence in the region which may already be happening as the Philippines and South Korea have reignited interest perhaps to further diversify trade away from China

There are only 4 CPTPP countries I think may Veto China's ascension to the CPTPP
- Japan
- Australia
- Mexico
- Canada

Japan - Its not difficult to see Japan vetoing China. Japan was responsible for the QUAD, the concept of FOIP, called for further European engagement in the SCS and resuscitated the CPTPP after the U.S left all of which are tools and concepts used to counter China and I imagine are suspect of China's application. These arent the actions of a nation welcoming of enhanced Chinese economic influence.

Australia - Australian Trade minister Dan Tehan has made it clear Australia to oppose China’s bid to join trade pact until it halts strikes against exports. To Australia's surprise the economy has not been as badly hurt from Chinese retaliation as many thought would happen. Industries dependent on China: Wine, Beef, Australian Lobster have been hit hard, despite this Australian exports to China grew in the face of their tariffs off the back of Chinese demand for iron ore which limits Chinese leverage over Australia decision for CPTPP ascension

Mexico and Canada - Under the recent USMCA (United States-Mexico-Canada Agreement) included a clause called 32.10 in the Generals and Provisions section of the USMCA. This clause
- "Requires USMCA countries to notify USMCA members three months in advance if they intend to begin free trade negotiations with non-market economies"
- "Entry by a Party into a free trade agreement with a non-market country will allow the other Parties to terminate this Agreement on six months’ notice and replace this Agreement with an agreement as between them (bilateral agreement)".

I think this is a bluff/posturing by America to Mexico and Canada saying you could have free trade with China but that could maybe come at the cost of Free Trade with us. This could influence their respective decsions on Chinese ascension

 

[John Fedup]

The US is pushing significant financial incentives for electric vehicles and batteries but only if they are manufactured in the US. Other “buy American” programs at state levels are common. In short, the USMCA is no guarantee of free trade. Canada may veto China’s entry into the CPTTP but it won’t be for preserving the USMCA, it will be because of hostage diplomacy.

 

[Nighthawk.NZ]

Japan have already said that they don't really trust China and may want to do a trial run separate from the CPTPP to see how it goes.

Australia have said they oppose China's bid, until it's strikes on Aussie exports are resolved, according to the Guardian... not that believe everything The Guardian says.

Haven't really seen anything official what Canada have said nor NZ... but many of the other countries in the CPTPP have issues with China on other things... including what is happening in the SCS.

Every country has to agree to allow another country to join, and that will be a very hard ask for China... considering this was all set up in the first place to counter China, before the US pulled out.

It will be interesting to see if we let Taiwan join and day no to China... personally I hope Taiwan can join and they do block China... that will really piss the CCP off...

 

[Gracie1234]

I think China will find it very difficult to meet the rules of the agreement, especially with its state-owned enterprises at present. It is likely to try and water down the rules to join, but then what is the difference with the RCEP? If China did join it would provide a huge incentive to change its internal operating model similar to when it joined the WTO.

 

[John Fedup]

Japan have already said that they don't really trust China and may want to do a trial run separate from the CPTPP to see how it goes.

Australia have said they oppose China's bid, until it's strikes on Aussie exports are resolved, according to the Guardian... not that believe everything The Guardian says.

Haven't really seen anything official what Canada have said nor NZ... but many of the other countries in the CPTPP have issues with China on other things... including what is happening in the SCS.

Every country has to agree to allow another country to join, and that will be a very hard ask for China... considering this was all set up in the first place to counter China, before the US pulled out.

It will be interesting to see if we let Taiwan join and day no to China... personally I hope Taiwan can join and they do block China... that will really piss the CCP off...

Taiwan in, no to China as long as the CCP is running things. Not particularly interested in US membership either.

 

[Nighthawk.NZ]

Quick question on the CPTPP... say Taiwan gets accepted before The PRC. Do they get same veto rights as the original signatures... is the a stand down period or trial period or is it only the original group that have it.. ???

 

[ngatimozart]

Quick question on the CPTPP... say Taiwan gets accepted before The PRC. Do they get same veto rights as the original signatures... is the a stand down period or trial period or is it only the original group that have it.. ???

I would presume that Taiwan would have veto rights upon acceptance. @MrConservative may be able to clarify matters.

 

[MrConservative]

I would presume that Taiwan would have veto rights upon acceptance. @MrConservative may be able to clarify matters.

Technically yes, once it has become a full member. But if China is accepted it would also have a Veto. Japan and NZ, which is the secretariat country, both want the CPTPP to include the US (and the UK), and will likely stall both China and Taiwan until the US signs. There are other countries that are also been seeking membership, which are ahead in the admission game which the current 11 members would like to see in the camp before Taiwan and China. Indonesia, Thailand and South Korea for example.

 

[aussienscale]

Technically yes, once it has become a full member. But if China is accepted it was also have a Veto. Japan and NZ, which is the secretariat country, both want the CPTPP to include the US (and the UK), and will likely stall both China and Taiwan until the US signs. There are other countries that are also been seeking membership, which are ahead in the admission game which the current 11 members would like to see in the camp before Taiwan and China. Indonesia, Thailand and South Korea for example.

And is it correct that under the CPTPP that it only takes one nation to use their respective veto power against a country joining and then that is it ? no matter what all the other members may say ? One country veto trumps all ?

 

[Nighthawk.NZ]

And is it correct that under the CPTPP that it only takes one nation to use their respective veto power against a country joining and then that is it ? no matter what all the other members may say ? One country veto trumps all ?

To the best of my knowledge yes... and all members must agree to allow the the country to join...

 

[Gracie1234]

The USA will not reapply to join the CPTPP until they are sure they can get it across the line domestically. They have a big gap between there domestic and international policies in terms of alignment. They do not. Even here we have had comments such as ...why should we back the USA side against China when the USA does not provide an FTA, but China does. Most countries in ASEAN would be saying the same thing. If we back the USA what is in it for us?

 

[MrConservative]

The USA will not reapply to join the CPTPP until they are sure they can get it across the line domestically. They have a big gap between there domestic and international policies in terms of alignment. They do not. Even here we have had comments such as ...why should we back the USA side against China when the USA does not provide an FTA, but China does. Most countries in ASEAN would be saying the same thing. If we back the USA what is in it for us?

Unfortunately the US does not have an advocate for FTA's like John McCain in the Senate or HoR any longer, particularly so in the Republican party. On the Dems side Joe Biden once was very Pro FTA's and aligned with McCain on trade, but in a party dominated by anti-free traders these days, he changed his tune to get elected. Thus it will get harder to achieve headway. The moderates in both parties are under attack from the sizeable extreme's in their base.

In the meantime I would like to see steady yet careful expansion of the CPTTP with the likes of those ASEAN countries not yet included like Indonesia as well as the UK and South Korea. Having those three countries in the tent would make it quite a powerful trading alliance, which should translate to improved security coordination between members. It will put shade on the US economically through their reluctance to join the club, weighting domestic prejudices over external realism, and shade on the PRC as countries within the expanded CPTTP will become less reliant on sourcing China for imports and production capacity, as well as sizeable albeit loose security collective as a bulwark.

 

[John Fedup]

America loves FTAs until lobbyists say otherwise. An expanded CPTTP without the USA and China allows time for both of them to get their $hit together, although in China’s case, unlikely.

 

[Samson]

NZ - UK FTA signed.

UK agrees free trade deal with New Zealand

The government says consumers and businesses will benefit from deal, but it is unlikely to boost growth.

www.bbc.com

The increased benefits will likely emerge over the medium to longer term. Another step towards the UK becoming part of the CPTTP.

If the UK does get acceptance into the CPTTP, which has been greatly pushed by Japan in particular, it will put pressure on US trade competitiveness leading it to join as staying out of the tent will become more burdensome. With the UK in the CPTTP, Japan will have no qualms refusing China's recent joining murmurs.

That looks to be a very asymmetric free trade agreement. Great Britain is giving up a lot, including dairy, lamb and beef market access; with little in exchange for all this from the other side. Everything important really is in there for New Zealand. In the ruthless world of international trade, this is not how trade agreements are supposed to work. I think an old friend has just done New Zealand an enormous favor.

How this all relates to geopolitics and defense is covered in a good article from the Democracy Project:

Geoffrey Miller: Geopolitics behind NZ-UK free trade deal



Damien O’Connor, our trade minister is in Europe at the moment with his lead trade negotiator trying to get an FTA with the EU as well. The EU has already said as part of their Indo-Pacific Strategy they want to sign free trade agreements with Australia, Indonesia and New Zealand. France, New Zealand’s historical European free trade adversary agreed in principle in 2018 to supporting an NZ EU FTA - which is important. France is also quite unhappy with Australia at the moment and Geoffrey Miller thinks New Zealand could be a major beneficiary of this fallout in relation to trade. If New Zealand can secure a quality FTA with the EU to augment the excellent agreement we have just secured with the United Kingdom, this will be a very significant opportunity to diversify trade away from an over reliance on one trading partner.



Geoffrey Miller: New Zealand could be the big winner of Aukus fallout

 

[ngatimozart]

Damien O’Connor, our trade minister is in Europe at the moment with his lead trade negotiator trying to get an FTA with the EU as well. The EU has already said as part of their Indo-Pacific Strategy they want to sign free trade agreements with Australia, Indonesia and New Zealand. France, New Zealand’s historical European free trade adversary agreed in principle in 2018 to supporting an NZ EU FTA - which is important. France is also quite unhappy with Australia at the moment and Geoffrey Miller thinks New Zealand could be a major beneficiary of this fallout in relation to trade. If New Zealand can secure a quality FTA with the EU to augment the excellent agreement we have just secured with the United Kingdom, this will be a very significant opportunity to diversify trade away from an over reliance on one trading partner.

Geoffrey Miller: New Zealand could be the big winner of Aukus fallout

I don't think that the AUKUS fallout is going to do us any favours with a EU FTA. The French are notoriously protectionist, agriculture and viticulture sectors, and that they are our major exports. The French farmers are a very excitable and volatile lot and they have a habit of blocking highways, ports and etc. So they will apply plenty of pressure to Macron and his government to veto or restrict access to the EU for both our agricultural and viticultural exports. The Dutch will have problems with our dairy and and some of the Eastern European nations will see us as a threat. From memory it only takes one country to veto a deal. Also the terms of an EU FTA are quite constrictive in that any country that has an FTA with them must adhere to EU trade and economic rules and regulations.

 

[spoz]

It’s also doing the UK government a favour; going some way to both assuring food supplies and keeping prices down; both of which were a concern in the immediate post Brexit period.

 

[MrConservative]

That looks to be a very asymmetric free trade agreement. Great Britain is giving up a lot, including dairy, lamb and beef market access; with little in exchange for all this from the other side. Everything important really is in there for New Zealand. In the ruthless world of international trade, this is not how trade agreements are supposed to work. I think an old friend has just done New Zealand an enormous favor.

How this all relates to geopolitics and defense is covered in a good article from the Democracy Project:

Geoffrey Miller: Geopolitics behind NZ-UK free trade deal

It is a 15 year transition on some Ag sector products though, so it is not that drastically bad for the UK and this period will allow time for them to be more efficient. At the end of the day the UK has been able to shift out of a trading block where it had massive and increasing trade imbalances year on year. As long as their overall terms of trade gets to be revenue neutral and reverse an ugly trend they will see that as a win.

UK-EU trade in goods 2023 | Statista

As of the second quarter of 2023, the value of goods exported to the European Union from the United Kingdom was 45.7 billion British pounds, compared with 80.1 billion pounds of goods imported, resulting in a negative goods trade balance with the EU of around 34.39 billion pounds.

www.statista.com

The ability of the Eurozone to be able to offer NZ any form of Defence umbrella from the other side of the world is a bankrupt concept. Only France has a presence in the region and power projection capability. The UK is now pivoting here, and frankly our traditional friends and partners within the Indo-Pacific are a much more significant and coherent entity.

I personally think some parts of Miller's article are utter nonsense that only someone who has blinkered themselves in the simplistic EU great US bad narrative could ever hold. It is fantasyland stuff that somehow some ASEAN nations, plus Canada and New Zealand have the opportunity to set up some kind of additional alternative group to QUAD and AUKUS. Let's look at these passages:

Below the hawks, a second division includes the EU, Canada and New Zealand, as well as potentially some Southeast Asian countries. This grouping is not oblivious to the challenges presented by China, but generally prefers to take a less confrontational approach. Its preferred modus operandi emphasises partnerships, engagement and dialogue (including behind the scenes) – combined with a more limited show of force when needed. Formalising and developing these methods is essentially what the EU’s new Indo-Pacific strategy is all about.

The constant pressure put on New Zealand over the past year to sign up to the US position on China may start to diminish as a result. Instead, New Zealand can start to work more closely with the more like-minded countries that are more closely aligned with its views. In the EU, Germany will also play a major role.

Ardern’s personal star power and her past role as president of the International Union of Socialist Youth mean she would be welcomed particularly by the SPD. Exactly what a more coordinated, non-Aukus approach towards China might involve remains to be seen.

Where's my bucket!

Damien O’Connor, our trade minister is in Europe at the moment with his lead trade negotiator trying to get an FTA with the EU as well. The EU has already said as part of their Indo-Pacific Strategy they want to sign free trade agreements with Australia, Indonesia and New Zealand. France, New Zealand’s historical European free trade adversary agreed in principle in 2018 to supporting an NZ EU FTA - which is important. France is also quite unhappy with Australia at the moment and Geoffrey Miller thinks New Zealand could be a major beneficiary of this fallout in relation to trade. If New Zealand can secure a quality FTA with the EU to augment the excellent agreement we have just secured with the United Kingdom, this will be a very significant opportunity to diversify trade away from an over reliance on one trading partner.

Geoffrey Miller: New Zealand could be the big winner of Aukus fallout

Hopefully NZ will stick to its guns with any EU FTA and not hurry. A quality FTA would be good in terms of us diversifying away from the China centric situation at the moment. But with the global power shift from an Atlantic centric world to an Indo-Pacific one, the Eurozone as a monolithic bureaucracy is increasingly going to find that the ability to be agile enough and adapt to this change, will see them as less relevant. They are increasingly struggling to find consensus amongst member states, which means over time they will need NZ and Australia as well as other Indo-Pacific trading opportunities more than we need them.

 

[Gracie1234]

It looks like we might be looking at joining AUKUS. Apparently, the door is open.

Stuff

www.stuff.co.nz

It would be interesting to see where we might contribute, Cyber and Quantum Computing are areas that i agree we should be investing in. I would be interested in what other areas people see an opportunity in.

Does anyone have a date for the defense assessment to be released?

The pressure and need for decisions to be made seems to be increasing significantly for our leaders, along with an increase in investment.