This is what happens when the previous Foreign Minister cuddled up to Obama and Kerry

Forget any FTA with the US anytime soon.

When Murray McCully wedded himself to Obama and Kerry’s anti-Israel plan any chance of something positive happening with the Trump administration disappeared as fast as Clinton’s victory march.

“Nothing happens quickly in trade or trade negotiation – at least nothing good anyway.”

So says Trade Minister Todd McClay as he plays down the excitement of a potential free-trade agreement (FTA) with the US.

Speaking from Washington, Mr McClay says official trade deal talks with representatives from the world’s largest economy are likely to be “some years away.”

Over the weekend, the US indicated it is “open to a free-trade agreement with New Zealand when the time is right.

In other words, not right now.

But that could still be a while away given the Trump administration is in the process of “a bit of a reset” with its trade priorities, Mr McClay says.

He adds there is a clear focus on negotiating “fair trade deals,” where the trade flows are balanced – meaning the exporting value matches that of the imports.

“What you are going to see is any deal [the US] is to make, they will want to ensure they are putting America first.”

The US is a big market for New Zealand, with two-way trade of $16 billion in 2016.

Mr McClay says when it comes to two-way trade between the US and New Zealand, trade is about $8 billion each way.

Despite the balance, it does not necessarily mean an FTA with New Zealand is on top of the Trump administration’s list of countries to build a free trade deal with.

“They are going to have a very heavy trade negotiation agenda for a number of years with the Nafta negotiations and trade deals with the world’s largest economies – the EU, for example.”

After the US pulled out of Trans-Pacific Partnership and indicated it wanted to renegotiate Nafta, many accused US President Trump and his administration of taking the economy down a protectionist path.

But Mr McClay says this is not entirely true.

“I think the doom and gloom that they are pulling back from trade and there will be no progress is not fair – it’s far too soon to be saying this.

“But it is clear they are going to chart a different course in terms of trade.”

 

We don’t rate. Move on.

 

-NBR

 


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