EDITORIAL: It's too soon to celebrate the signing of this "free trade" deal
EDITORIAL: Premature celebration has been a hallmark of the Trans-Pacific Partnership Agreement in New Zealand. The decision to hold the signing of the deal in Auckland is part of that tradition. No doubt John Key and his supporters will say this is a great deal or even, as one cheerleader burbled, "the greatest trade deal of all time".
The critics have also pointed out that the signing, like nearly everything else about the TPPA, was a secret. New Zealanders found out that they would be the host only after leaks in other countries. Here, as always, New Zealanders have been kept in the dark.
Perhaps the TPPA authorities decided that pliant little New Zealand was less likely than other countries to stage riots at the signing. That is probably the case. But still serious doubts remain about the TPPA and whether it is, on balance, a good thing for this country. The razzmatazz of the signing changes none of that.
We can't know the answer till experts have done a proper and full analysis of the thousands of pages of the deal. That has not been done, and even if it is done it will be a long business. In the meantime, the early criticisms remain unanswered.
On the trade front, the gains have been small to modest. Fonterra said it was "very disappointed" at the deal, which fell far short of the agreement's original ambition to eliminate all tariffs. That verdict says a great deal, and it is a counter to the self-serving claims of Government politicians. The lowering of dairy tariffs is patchy and in vital areas it takes many years to phase in.
Meanwhile, some agribusiness experts question the conventional wisdom that the phase-out of tariffs will lead to a business bonanza in those markets for New Zealand. Changes in the markets, such as the growing competitiveness of the US dairy industry, now raise real questions about that.
But the non-trade aspects of the deal are the most worrying. The worst is the mechanism allowing foreign companies to sue New Zealand in controversial offshore tribunals. This raises serious problems of sovereignty and fairness.
These tribunals are not courts as we understand them. They are courts dedicated to the interests of investors, rather than countries. Appeals are very limited. Conflicts of interest among those on the tribunals are not rigorously controlled. Judgments are not required to be consistent.
Lawyers from many countries have questioned the Investor-State Dispute Settlement system, and there has been growing political opposition to them among Western countries. Whatever these tribunals do, there is no evidence they promote the cause of "free trade".
Supporters of the agreement will point to the clause removing Big Tobacco from the ISDS system. But the tribunals could be used to stymie New Zealand interests in other areas. And the very fact of the tribunals' existence can have a "chilling" effect on governments. The case brought by tobacco companies against Australia led New Zealand to halt its move to plain packaging of cigarettes.
So the signing will take place with all its brouhaha, but polls suggest a majority don't much like it. The evidence suggests they are right to have serious doubts.