Trade and Export Growth Minister Damien O’Connor speaks to Newsroom about a world beyond free trade agreements, winning consensus in a time of fracture, and handling China
At first glance, the plain-spoken man affectionately known by some as Chainsaw might seem an unlikely fit for the world of diplomacy.
In taking over the trade portfolio from his old flatmate David Parker after last year’s election, Damien O’Connor has certainly presented a distinct stylistic contrast.
As the Trade and Export Growth Minister himself admits, his predecessor is known for a more cerebral approach to politics: certainly, the incumbent seems less likely to rail against “the excesses of globalised capital” and “subjugat[ing] ourselves to the interests of the one percent”, as Parker did in one of his first trade interviews with Newsroom.
Fittingly, given his rural background, O’Connor reaches for a farming metaphor to describe how the two operated in tandem last term as he held the agriculture and associate trade portfolios, and Parker environment and trade.
“A Huntaway just barks, chases sheep, and a heading dog heads out, usually doesn’t bark, heads out around and just kind of turns the sheep in the right direction … I figure that David’s being the Huntaway, clearly indicating there’s a message here, that is ‘Move’, because he’s been barking.
“If the heading dog doesn’t work in the right way, they’ll charge off somewhere else, so it’s my job to kind of help move things in that right direction – I think we work well as a team.”
He is a lone wolf in trade now, but O’Connor stills sees his strengths in herding – or to put it more diplomatically, “building the relationship with ministers to try and just break through some of those political hurdles that will inevitably occur”.
“The statement was well crafted, it was ambitious, it left the door [open] for flexibility to allow those different economies to not have to draw a line in the sand, and I think it was the combination of the relationships that we’ve built across the ministers and officials, along with the fine tuning of the wording, meant that we got it over the line.”
An early test of those skills came when he hosted a meeting of APEC trade ministers earlier this month. The results were broadly positive, with consensus on cutting red tape slowing the movement of Covid-19 essentials across borders, and an agreement to consider reviewing “charges levied at the border”.
That delicate wording was no mistake, with the US understood to have in effect blocked a commitment to cut tariffs, but O’Connor remains happy with the outcome.
“We were not surprised by the different positions on some of these issues, but what we were pleased with was the momentum we’d built in the lead-up to the meeting and through the development of the statement meant that it was, at the last minute, very hard for any of those economies to stand up and say…‘We can’t reach consensus on these things’.
“The statement was well crafted, it was ambitious, it left the door [open] for flexibility to allow those different economies to not have to draw a line in the sand, and I think it was the combination of the relationships that we’ve built across the ministers and officials, along with the fine tuning of the wording, meant that we got it over the line.”
A progress report on the APEC statement will come at the World Trade Organisation’s ministerial conference in late November, where O’Connor hopes the momentum can transfer to an even more significant stage.
He is somewhat noncommittal on whether WTO members can win consensus for the reform the organisation sorely needs, saying it is for new director-general Dr Ngozi Okonjo-Iweala to assess what is possible in the coming months.
“We’ve given her a really good runway, we’ve given her some momentum, and now it’s for her to craft it.”
The Government is also keen for New Zealand to be included at October’s G20 summit in Rome, leveraging off its APEC hosting rights to secure an invite as others have in the past.
‘The new way of diplomacy’
For now, at the top of O’Connor’s to-do list is wrapping up trade deals with the United Kingdom and the European Union; Newsroom’s interview comes days before he jetted out to London and Brussels in a bid to make headway on some of the more contentious areas facing negotiators.
Put those two prizes to one side, however, and there seems little fertile ground remaining to be broken as far as sweeping FTAs go.
A mixture of domestic politics and regional dynamics has stymied progress with India, Latin America’s Pacific Alliance grouping, South America’s Mercosur and the Middle East’s Gulf Cooperation Council, while negotiations with Russia-Belarus Kazakhstan Customs Union are still on hold following the poisoning of Sergei and Yulia Skripal.
O’Connor suggests plurilateral, sector-specific agreements may be the way forward, citing New Zealand’s digital economy initiative (DEPA) with Chile and Singapore, as well as a climate change equivalent (ACCTS) with Costa Rica, Fiji, Iceland, Norway and Switzerland.
“That’s the new way of diplomacy and trade: it’s building off the areas that we agree on, rather than often getting to the points of disagreement and then spending years literally trying to work through that.”
The same sentiment drove a New Zealand- and Singapore-led initiative to ensure supply chains ran smoothly in the early days of Covid-19 – an issue more critical than ever, with RNZ recently reporting serious concerns from Kiwi exporters about their produce getting to market.
O’Connor says the Government is keeping a close eye on the changing trade patterns around the globe and associated threats for New Zealand businesses. Large-volume traders like Zespri and Fonterra have themselves begun to take their own precautions through charters or ever-closer sectoral cooperation to secure transport capacity.
“We can’t force anyone to look for new markets, but the same advice can be given to a retailer on Lambton Quay: try and open yourself up to a wider range of customers and you’ll have less chance of getting whopped should some disruption occur.”
“I come from a dairy industry background: cooperation has delivered results for them, and it will for the wider economy when it comes to these challenges.”
Another supply chain complication is the wider geopolitical climate: as a briefing to O’Connor in November on New Zealand’s supply chain resilience noted: “Geostrategic and security considerations are more prominent than previously, and the boundary between supply chain resilience and wider ‘economic security’ increasingly amorphous.”
China’s trade spat with Australia has served as a high-profile example, driving both O’Connor and Foreign Affairs Minister Nanaia Mahuta to remind businesses of the need for economic diversification.
“We can’t force anyone to look for new markets, but the same advice can be given to a retailer on Lambton Quay: try and open yourself up to a wider range of customers and you’ll have less chance of getting whopped should some disruption occur.”
O’Connor himself faced a minor whopping earlier this year, when he told international media Australia should “follow us and show respect” towards China.
“Diplomacy’s about being able to speak in respectful ways, and I learned a lesson,” he says now, somewhat ironically.
There have been no further faux pas on that level so far, suggesting it’s a lesson he’s taken to heart.
