Minister of Trade and Export Growth David Parker says retaliatory tariffs placed on US products by the Chinese Government won’t impact New Zealand’s economy.
In fact, Parker says his advice from the Ministry of Foreign Affairs and Trade (Mfat) is that the response so far from China has been “measured.”
“We still risk the escalation of these tit-for-tat measures – so we’re pleased to see that their response has been targeted and moderate.”
In response to new US tariffs on steel and aluminium, Beijing implemented its own import taxes on 128 US products.
These include a 25% tariff on US pork products as well as aluminium scraps and a 15% on dozens of different fruits and nut products.
In response, the Whitehouse accused China of “distorting the market” and not fairly targeting US exports.
Parker says that as New Zealand has a free trade agreement with China, it has some protection from any such tariffs.
But he is calling on our trading partners to abide by the World Trade Organisation (WTO) rules when it comes to imposing new tariffs.
“New Zealand is not benefiting from this escalation in protectionism around the world whether it’s from tariffs or non-tariff barriers it is problematic for New Zealand.”
Meanwhile, New Zealand is still trying to hammer out an exemption from the US’ steel and aluminium tariff – Parker says it’s “disappointing that we have not yet achieved one.”
Last month, Prime Minister Jacinda Ardern wrote to US President Donald Trump to plead New Zealand’s case for an exemption.
At the time, Ardern said New Zealand has a “strong case.”
But the Government’s tone has since shifted, with Parker saying less than a week later that the chances of securing an exemption were just “50/50.”
Asked about the exemption on Tuesday morning, Parker says he does not know whether an exemption will be achieved.
“We’re still seeking an exemption from the steel and aluminium tariffs – about another 50 countries in the world are also.”
In the background, Parker says officials are still pursuing trading relationships with Europe and Great Britain, as well as negotiating the Regional Comprehensive Economic Partnership (RCEP) trade agreement.
“In respect to trade agreements, I think our exporters can rest assured that we’re doing our utmost to protect their interests.”
3 Comments
Awwww c'mon David . no impact ? ........... if the world economy stumbles now it will be like an accident at start of the the Tour de France as we all go headlong into the melee .
We are, after all, part of an inter-connected world economy .
What if the demand for logs slumps ?
Or the ability of Chinese tourists to come here is curtailed ?
Or if the Aussie economy our biggest trading partner goes into recession behind a Chinese slowdown or slump ?
I would be way more circumspect before making such comments
Go ahead call me a nutter ....... I reckon we could be facing a recession in 2019 as a result of this Trade standoff between the US and China .
And its not only the possible trade war that is likely cause of the coming recession , it could be a perfect storm for thew following reasons :-
1) Interest rates have been increased by the Fed , QE is dead
2) The move away from QE is causing global money supply to slow down which will reduce AGGREGATE
DEMAND in the US and Eurozone , and we will not escape this down here
3) Asset prices fueled by cheap money such as shares and Bonds are at a zenith ............ yes that includes Auckland house prices .
4) A lot of speculators in all asset classes are under water already , using negative gearing at historically low rates was always going to be dangerous
5) A Trade war could send the US into recession if it gets out of hand
6) Central Banks do not have wriggle room to stimulate if there is a downturn
7) China has so much internal non-performing debt that the smallest variable could trigger a run on banks .
8) China cannot have more fiscal stimulus without major distortions to their economy
It may not happen , but its been bubbling away for a while now .............you have been warned .
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