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New Zealand 'Incredibly Well-Positioned' To Weather Tariff Storm - Christopher Luxon
Prime Minister Christopher Luxon says New Zealand is "incredibly well-positioned" to deal with global tariffs rolled out by the US.
US President Donald Trump's new tariff on New Zealand goods took effect over the weekend - but at 10 percent, it was a lot lower than what many other countries were slapped with, such as Vietnam's 46 percent and China's 34 percent (on top of existing tariffs).
The tariffs sent markets reeling, losses comparable to the global financial crisis, the arrival of Covid-19 and 1987's Black Monday crash.
Luxon told Morning Report , ahead of the opening of the NZX on Monday, the government was working hard on bilateral and multilateral relationships for free movement of goods and services.
Asked how worried he was about the New Zealand share market, Luxon said it was a "really anxious time for everyone around the world, and people are unsure about what's coming next".
"But the reality is New Zealand is incredibly well-positioned relative to other countries to deal with this environment. It's not what we want, but actually, we can - we will - continue to act in our own national interests. We'll continue to build our opportunities for New Zealand businesses all around the world."
Luxon said New Zealand was not one of 50-plus countries the Trump administration claimed were wanting to start new trade talks with the US as a result of the tariffs.
"We'll continue to advocate against tariffs. We think trade wars and tariffs are bad for the global economy. We don't support that. We don't think that's the way forward. We continue to make our case around that."
Luxon said Trump's claim New Zealand had a 20 percent tariff on American goods was "not true", and New Zealand officials were having "conversations" with their US counterparts about it.
"They've basically taken a calculation which is essentially the value of our trade surplus on goods only this year divided by I think, the value of the goods that we actually export in total. So the upshot is, they've used that as a proxy for tariffs.
"The real tariff is 1.9 percent, and in most of the cases, I think 94 percent of the cases are tariffs that we pay in America are higher."
Asked if the US was acting like a "friend", Luxon said Trump was doing what he promised in the election campaign.
"You've got a president that campaigned very transparently, very straight-up about the tariffs as part of his agenda and part of his policy, and he's obviously implementing that - as much as we disagree with it.
"And we are friends with the US, we are friends with many countries, but we have disagreements with them, and this is one of the areas where we disagree. We just don't think this is good for the global economy."
Trade Minister Todd Mcclay has ruled out placing retaliatory tariffs on the US.
Luxon said the future of trade for New Zealand lay in "forming partnerships" with other nations, such as through agreements like the CPTPP - and perhaps expanding it to include the economic powerhouse that is China.
"Well… we have a series of criteria around CPTPP. There's sort of three principles that any applicant needs to work their way through, and it's important that those that criteria is held up… so that doesn't change as a consequence of this… there are criteria to be met and they've got to meet them, but we could push that."
Bringing in the EU was also as possibility.
"It's a very comprehensive, high quality agreement that we encourage anyone to join, but there is a process, as you'd understand, irrespective of which country or region it is that needs to be worked through so, you know, so that we get high quality partners that have respect for the international rules-based system and trading arrangements."
RNZ
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