Obama puts off trade talks

Reuters

TRADE TALKS OFF: US President Barack Obama has put talks on a trans-Pacific partnership deal on hold, just weeks before they are due to start.

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The elusive prize of a free trade agreement with the United States is slipping from New Zealand's grasp.

Just weeks from the start of talks on a trans-Pacific partnership deal, encompassing New Zealand, Chile, Singapore, Brunei and the United States, President Barack Obama has put the talks on hold.

Prime Minister John Key was yesterday confident the talks would be rescheduled but the Government's silence up till now suggests the delay is a blow. It has been aware of the US move for several days but Mr Key confirmed the delay only yesterday after an anti-globalisation group, Arena, highlighted recent statements in the US.

Mr Key admitted that the Government was "deeply disappointed". But he reiterated that the talks had only been postponed, not cancelled.

The US was still appointing its next trade representative, and the Obama administration wanted to undertake a "stocktake" of trade policy before embarking on more talks.

The delay is likely to fuel concerns that the US and other countries will retreat into protection as the worldwide economic recession bites.

Mr Key said that would be a concern. "If the world wants to come through the recession in the strongest way possible, free trade is one of the levers we can use to advance that.

"We will continue to advocate very strongly for a free trade agreement with the US and removal of protectionism barriers."

The trans-Pacific agreement is intended to build on the so-called P4 free trade agreement between New Zealand, Chile, Singapore and Brunei, and is New Zealand's back-door entry to a free trade agreement with the US a deal which has proved elusive over more than a decade.

Other countries, including Australia and Vietnam, have signalled their intention to get on board.

Labour leader Phil Goff was yesterday optimistic that the goal of an FTA remained on track. The US saw the strategic advantage of having a high quality trade agreement in the fast-growing Asia-Pacific region.

The Dominion Post