United States President Barack Obama's re-election has had the immediate effect of averting - or perhaps simply delaying - a trade war between the US and China. This would have been triggered had Republican challenger Mitt Romney been elected president and kept his pledge to declare China a "currency manipulator" on the first day of his presidency. New Zealand was bound to be hurt by the fallout.
But another threat needs to be averted, too. A series of stimulatory but temporary tax cuts will automatically expire on December 31 just as some hefty spending cuts are introduced. The combined effect will shrink the US economy by up to 4 per cent.
Obama's immediate priorities will as a result be domestic, aimed at preventing his country's plunge over this so-called "fiscal cliff". Much of the world economy would be dragged over with it.
Treasury officials here have for some time included this forced fiscal consolidation as a global risk, along with the euro debt crisis and the prospect of a more significant slowdown in emerging Asian countries including China.
The snag is that Republicans - who campaigned for tax cuts - still control the House of Representatives and can continue to filibuster Obama's agenda in the Senate. The Democrats, on the other hand, want to maintain social spending programmes. Something has to give.
Congressional leaders, encouragingly, began tentative discussions yesterday to find a way through the impasse.
More promising for New Zealand, the Administration and Republicans in Congress could join forces and enable bolder initiatives on the trade front. This would help hasten work on the Trans-Pacific Partnership, now involving 11 negotiating partners including New Zealand. The next round of talks is scheduled next month in Auckland.
Washington's push for strong standards on intellectual property, labour and environment are among the impediments to a deal, along with regulations on state-owned enterprises. More critically, The Diplomat, a current affairs magazine covering the Asia-Pacific, has raised questions about membership. Should China be encouraged to join? Its exclusion risks dividing Asia into competing blocs rather than bringing them together in a bold bid to promote regional free trade. Obama's posture will be pivotal.