Rising protectionism and upcoming elections have raised the stakes for a critical trade summit, with the Government welcoming pressure from outsiders as it pushes for further cuts on agriculture and fisheries subsidies.
The World Trade Organisation’s latest ministerial conference is taking place in Abu Dhabi this week, with New Zealand serving as one of the three vice chairs for the meeting.
Speaking to Newsroom ahead of his trip, Trade Minister Todd McClay said one of the country’s priorities was making headway on the elimination of agricultural subsidies, which amounted to almost $900 billion a year worldwide.
Discussions on the topic of agriculture have proved contentious, with India leading a push from developing countries to be granted a permanent waiver on rules about the stockpiling of food products.
While New Delhi and others argue changes are needed to ensure food security, others believe stockpiling amounts to a distortion of free trade, and McClay believed a balance could be struck between the two viewpoints.
“If you’re looking at it from a pure trade point of view, some would argue, ‘Well actually just buy it elsewhere in the world, but if you think post-Covid, it’s not unreasonable that some of these countries are quite concerned, because they have large populations, [and if] you don’t have the food to feed them, you end up having famine, then the government’s not doing its job properly.”
The new Government has made signing a free trade deal with India one of its top foreign policy priorities, but McClay said that would not lead it to alter its stance on the issue, and New Zealand’s official role in discussions could in fact strengthen relations between the countries.
He hoped additional progress could be made on eliminating subsidies for the fishing industry, with an initial agreement from the 2022 meeting still awaiting formal ratification and further negotiations underway on the next stage of reforms.
As vice chair, New Zealand had also been given specific responsibility for overseeing negotiations on e-commerce, with discussions underway on whether to extend a moratorium barring cross-border duties.
“Think about the New Zealand gaming industry, worth about half a billion dollars, it’s growing pretty quickly: if countries put tariffs up every time you want to download a game or a movie, like a tariff at the border, then that’s going to harm our sector,” McClay said.
One area where there is unlikely to be meaningful progress is the WTO’s beleaguered dispute settlement process, which has been non-functional since late 2019 due to an American veto on new appointments to the organisation’s appellate body that has spanned presidential administrations.
McClay said there had been some progress towards a resolution, but it was important to finish the remaining work within the next 12 to 18 months – although that timeline would be “heavily dependent” on the outcome of the upcoming US presidential election.
University of Auckland emeritus law professor Jane Kelsey has expressed concerns about the way the WTO will be carrying out negotiations in Abu Dhabi.
In a piece for The Conversation, Kelsey said negotiations on crucial issues had been “scheduled simultaneously for small rooms that can accommodate only a subset of members, whom the director-general will choose”, adding that developing countries viewed the approach as “exclusionary and manipulative”.
McClay did not believe it was fair to characterise the approach as manipulative but agreed with Kelsey that the WTO needed to be open and transparent in his work, saying he had raised the matter with director-general Ngozi Okonjo-Iweala during a recent visit to Geneva.
“You can’t negotiate with 200 people, but it doesn’t mean that those other 190 people don’t have a right to know what’s going on and be involved, because the rules have an effect upon them and they have to agree as well.”
Civil society groups and outside observers had an important role to play at the ministerial conference in “keeping a bit of pressure on us to do the best job we can”, he added.
The gathering was particularly important given the continued growth in protectionist sentiment, as well as uncertainty associated with looming elections in a number of countries.
“If the WTO wants to make progress, it’s going to be easier now than it might be in a year’s time [when] we’ve got a number of new governments [and] whatever happens in the US, and those administrations take a bit of time to sort of work out what they’re doing or get everything lined up.”
