Free trade fiasco

Last updated 12:03 13/04/2008

Free Trade with ChinaNZ made history on April 7th by being the first "developed" country to sign a free-trade deal with China - a huge and scary landmark for New Zealand.  The agreement will remove virtually all trade barriers for New Zealand exports over a decade, with the first wave of tariff cuts starting in October. While it may bring smiles to the faces of those in the wine, lamb and dairy industries, the implications for other Kiwi businesses and the environment are not so bright.

According to the Ministry of Foreign Affairs & Trade, New Zealand's negotiations with China will "keep our exporters in the 'game' and help defend existing market shares - particularly in areas where China is already New Zealand's largest international customer - such as milk powder, wool and education".  Hmmm, what about our integrity and our "clean green" image? Not only have we done a deal with a country renowned for its human rights abuses but we've done it at a time when leaders across the world are admirably taking a stand against China's oppression against Tibet.

The eco-implications of this deal are extensive and incorporate economic, social and environmental. Green Party co-leader Russel Norman sums it up well in a media release trading away our integrity and highlights that "this trade deal does not eliminate non-tariff barriers to fair trade - things like forced prison labour, child labour, sweatshop conditions, a ban on independent unions and poor environmental protections. These elements of authoritarian capitalism give Chinese business an unfair advantage over New Zealand businesses and will result in further job losses in New Zealand as tariffs fall".

Other concerns range from quality of building materials to exploitation of Maori culture as a result of the free trade deal. The recently launched Maori Russian dolls made in China is a classic example of the commodification of culture.  There's something wrong and tragic about "NZ" items sold in gift shops being made in China.  Ideally the "Buy Kiwi Made" campaign will help to combat this slightly but the issue of '"heap 'n' nasty" imports is set to magnify as a result of  the free trade deal.

While some Kiwis may be tempted by the cheaper items flooding into the Warehouse and Briscoes etc, I fear for NZ businesses as well as landfills.  The "buy a new one cos it's cheaper than getting it fixed" mentality is rampant and set to continue.  I would love to think that we'd revert to the days of buying quality items (from shoes to tools to clothes) that are genuinely made to last - for years rather than months.

And let's talk about dairy. The deal looks good for Fonterra but what about the health of the people and farmland? We're exporting obesity in the form of milk and cheese farmed by inappropriate and unsustainable agriculture. The Canterbury Plains is a classic example.

Apparently, about 35 per cent of New Zealand goods will become tariff free by October, with another 31 per cent tariff free by 2013. The bulk of the remainder will be tariff free by 2019. 

What is "free trade" free of anyway? It's certainly not fair trade. Free of tariffs maybe, free of exploitation - a resounding no! 

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Alan Wilkinson   #1   02:21 pm Apr 13 2008

This is Minto-speak twaddle. Yes, Tibet and human rights generally in China are still disgraceful. However the trends are generally in the right directions and the more exposure the Chinese people have to the outside world the better the prognosis.

For the rest, free trade increases opportunities and choices for everyone. Eco-fascists don't want people to have choices. Some of them don't want people full stop. However, those attitudes should be treated with the utter contempt they deserve.

Billions of people in Asia are immensely better off than they were a few years ago thanks to free trade. So are New Zealanders. Goods have never been more affordable for our poorest people. Unemployment in New Zealand has never been lower.

Claptrap like your blog is an insult to our intelligence.

Brian   #2   10:18 am Apr 14 2008

Minto made some similar statements in his Press article last recently.

"We’re exporting obesity in the form of milk and cheese....". Are you serious? Does personal choice come into it at all? Perhaps you'd like to see wine exports stopped as well because of the alcoholism being exported?

I agree with everything Alan says about this latest blog - it's tosh.

Alastair Brown   #3   11:20 am Apr 14 2008

My objections to stuff that is "Made in China" (and probably Vietnam, Thailand, etc) are based on the fact that manufacturing standards are generally lower than NZ. When I speak of manufacturing standards I don't mean the rather narrow view of the quality of the finished product, which is often comparable to stuff made in NZ. I do mean the very reasons that NZ made stuff is dearer, namely:

- Healthy and safety of workers.

- Sustainable wages paid to workers. While the wages paid to Chinese workers varies greatly, I do know that it goes as low as $2/day. Don't tell me that $2/day is "immensely better off than they were a few years ago".

- Environmental standards.

wasi   #4   12:08 pm Apr 14 2008

"For the rest, free trade increases opportunities and choices for everyone. Eco-fascists don’t want people to have choices."...what crap..the free market nuts are at it again..good blog..

ants   #5   01:00 pm Apr 14 2008

Alan, I didn't realise that with our massive inflation that goods are still more affordable than ever before. Has cheese always been $16.99 a kilo in New Zealand? Or were you only talking about Plasma TVs?

It's a pretty broad generalisation to make when more Kiwis are suffering than ever before due to the rubbish government we have.

Alan Wilkinson   #6   01:26 pm Apr 14 2008

Alastair, get a life. China has done more for the world's poor than any other nation in the last couple of decades. And of course it's not finished yet but look where they started from.

Yours is the "I'm all right, Jack. Pull up the drawbridge." approach.

That's fine if you're a selfish Western unionist, but don't pretend it's moral or virtuous - or good for humanity.

Alan Wilkinson   #7   02:54 pm Apr 14 2008

Fair call, ants. I was focused on the China trade subject of the blog.

Yep, food inflation is a recent worry. Not helped by the usual counter-productive consequences of government interventions (more like pointless posturings) on the climate change issue.

How much methane does a kilo of cheese come with? At those prices I guess the producers are going to be looking to produce a lot more.

Alastair Brown   #8   03:20 pm Apr 14 2008

Alan, I do have a life, don't get personal, play the ball, not the man.

What do you mean by a "selfish Western unionist"? Selfish? I think if you knew me you wouldn't make that assertion. Western? I live in NZ, east of Asia, west of the Americas. Unionist? Someone who belongs to a trade union? I haven't belonged to a trade union since 1988, and I think it was compulsory then.

China may have done a lot for the world's poor, but if it lived up to its ideals and enforced its own laws on minimum wages and environmental protection, I'd be a bit keener on buying their products.

BTW I totally agree with you about the silliness of laws about bike helmets.

ugly   #9   03:41 pm Apr 14 2008

"I would love to think that we’d revert to the days of buying quality items (from shoes to tools to clothes) that are genuinely made to last - for years rather than months."

Elitist drivel - nice for those that can afford it - I guess the "poor" should just do without eh? Don't give me the "cheaper (and more sustainable) in the long run line" - that is fine as long as you have enough to feed the kids in the first place.

Something I can never reconcile with the eco-types - are all for the "poor and downtrodden" but don't want people buying cheap goods! I grew up in a poor neighbourhood before the Warehouse existed - some kids simply didn't have shoes, but at least the ones that did could wear them for a while - ah, the good old days....

Efficiency and progress are ours once more....

Alan Wilkinson   #10   04:21 pm Apr 14 2008

Ok, Alastair, you have a life so why nitpick? The $2/hr worker certainly wasn't making that subsisting on a farm. Neither was there any prospect of anything better a couple of decades ago for her parents.

I didn't say you are a selfish Western unionist. Note the word "if".

The arguments you were making (ie they get paid less than us and don't have the same working conditions and safeguards) are traditionally used to defend protectionism in the West by unions. But they are not altuistic as pretended. They are selfish, to protect their own castles and to prevent opportunities being given to people a lot worse off than themselves.

Of course we all want things to improve faster, but given China's rate of growth it's hard to argue that is feasible. Blocking free trade would certainly impede rather improve progress on these matters.


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