WikiLeaks cable: NZ's Minister of Trade assesses highlights of Washington visit
June 4, 2009 New Zealand's Minister of Trade assesses highlights of Washington visit
date:2009-06-04T23:54:00 source:Embassy Wellington origin:09WELLINGTON128 destination:VZCZCXRO1019 PP RUEHAG RUEHCHI
RUEHFK RUEHHM RUEHKSO RUEHPB RUEHRN RUEHROV RUEHSR DE RUEHWL #0128/01 1552354 ZNY CCCCC ZZH P 042354Z JUN 09 FM
AMEMBASSY WELLINGTON TO RUEHC/SECSTATE WASHDC PRIORITY 5886 INFO RUEHZU/ASIAN PACIFIC ECONOMIC COOPERATION PRIORITY
RUCNMEM/EU MEMBER STATES COLLECTIVE PRIORITY RUEHSS/OECD POSTS COLLECTIVE PRIORITY RUEHBY/AMEMBASSY CANBERRA PRIORITY
5525 RUEHDN/AMCONSUL SYDNEY PRIORITY 0856 RHHMUNA/CDR USPACOM HONOLULU HI PRIORITY RUEATRS/DEPT OF TREASURY WASHDC
PRIORITY RUCPDOC/USDOC WASHDC PRIORITY 0311 classification:CONFIDENTIAL reference: ?C O N F I D E N T I A L SECTION 01
OF 02 WELLINGTON 000128 SENSITIVE
SIPDIS
STATE FOR EAP/ANP, EEB/TPP STATE PASS TO USTR B. WEISEL S... ?C O N F I D E N T I A L SECTION 01 OF 02 WELLINGTON 000128
SENSITIVE
SIPDIS
STATE FOR EAP/ANP, EEB/TPP STATE PASS TO USTR B. WEISEL STATE PASS USDA/FAS E.MANGINO STATE PASS TO DEPT OF AGRICULTURE
E.O. 12958: DECL: 06/04/2019 TAGS: EAGR, ECON, ETRD, PREL, NZ SUBJECT: NEW ZEALAND'S MINISTER OF TRADE ASSESSES
HIGHLIGHTS OF WASHINGTON VISIT
Classified By: CDA David J. Keegan; Reason: 1.4 (b) and (d)
1. (SBU) Summary: New Zealand's Trade Minister Tim Groser categorized all his meetings in Washington as extremely
successful; he also expressed decidedly negative reactions to recent dairy export subsidy measures by the U.S. and EU.
Groser outlined his plans to revamp NZ development assistance to focus more on developing the trade and economic
capacities of Pacific Island nations. He was particularly encouraged by his discussions with U.S. officials in advance
of the Cairns Group meeting regarding marrying efforts to address climate change concerns with agricultural initiatives.
End Summary.
Background
----------
2. (SBU) On June 2, Charge', Ag Attache' and Econoff met with New Zealand's Trade Minister Tim Groser to get his
assessment of his series of meeting and speaking events in Washington between May 12-15, 2009. Also acting in his
capacity as NZ's Associate Minister for Climate Changes along with Adrian Macey, NZ's Climate Change Ambassador at the
Ministry of Foreign Affairs and Trade (MFAT), they covered issues of concern to NZ in both the trade and environment
arenas. Graeme Harrison, Chairman of the International Business Forum in NZ accompanied the delegation and was present
at events with NZ business interests and the U.S. Chamber of Commerce. Minister Groser also met with the President of
the World Bank, Robert Zoellick, USTR Ron Kirk, Mike Froman, Deputy NSC Advisor for International Economics Affairs and
Todd Stern, the State Dept.'s Special Envoy for Climate Change. Groser also gave a speech to the U.S. Chamber of
Commerce entitled, "Trade and the Road to (Economic) Recovery - An Asia Pacific Perspective."
New Direction in New Zealand's Development Assistance
--------------------------------------------- --------
3. (SBU) The first half of the Minister's readout was devoted to his plans/vision for changing New Zealand's economic
aid and development assistance programs. He spoke about merging NZAID (NZ aid agency) back into MFAT and using economic
assistance to focus more on building trade and economic development in and with Pacific Island countries. Groser said he
liked some of the studies and policy advice that was being produced by the Lowy Institute in Sydney. Groser stressed
that GNZ's vision was not so narrow as to shift focus in assistance merely as an attempt to increase export
opportunities to Pacific nations but a genuine desire to build more sustainable economies. He said that one measure of
New Zealand's success could be a negative trade balance with the islands as they improve their ability to export to New
Zealand and Australia.
Trans-Pacific Partnership
-------------------------
4. (C) Turning his attention to the issue of closer trade relations with the U.S., Groser said he was "absolutely
thrilled" at the positive signals from Secretary of State Clinton, USTR Ron Kirk and others regarding the improved
relationship between the United States and New Zealand. He noted that the recent visit of Foreign Minister Murray
McCully to Washington had been very successful from New Zealand's perspective, and they were intently focused on finding
ways to continue improving the relationship. Turning specifically to prospects for a Trans-Pacific Partnership Agreement
(TPP). Groser said he expected the announcement soon to restart negotiations, but the shape and tone of the announcement
could/would be worded differently from what was originally announced (e.g., perhaps a different configuration of
countries and/or issues). He said he was realistic and recognizes that it has to be a U.S. decision and that NZ cannot
influence that decision but would be very surprised if the U.S. were to say no to restarting TPP negotiations. If U.S.
were to say no (to TPP), he sees negative consequences for the United States as well as its friends in the region, with
China taking on a more dominant role among the Asia WELLINGTON 00000128 002 OF 002 Pacific economies. "The question
would be, who is going to lead the trade and investment integration in Asia in the future in the absence of a leadership
role played by the United States and the answer is clearly China." With China extending its influence in the
Asia-Pacific region, Groser "would rather see more U.S. involvement in the region and the sooner the better."
Dairy Export Incentive Program (DEIP)
-------------------------------------
5. (C) Groser stressed that he was "deeply disappointed" with the U.S. announcement of its support for dairy export
subsidies (DEIP). "At the end of the day, it is impossible to reconcile the U.S. action with the recent G-20
communique'." Groser went so far as to say that if the upcoming OECD Ministerial drafted a similar communique', "I could
not let New Zealand be associated with such hypocrisy and I would not sign it." Groser expressed his concern that the
U.S. decision to implement DEIP will lead us down the slippery slope of a larger future trade war as evidenced by the
recent French initiative to get pig meat subsidies in place. In the strongest of terms he said, "the U.S. can't expect
the rest of the world to take trade liberalization seriously if the U.S. says one thing and does another."
6. (C) Comparing the EU and U.S. approach to dairy export subsidies, Groser indicated he was "informed" that the EU's
Dairy Management Committee (DMC) made its decision to introduce export subsidies in a vacuum without an understanding of
the bigger picture while the U.S. made the decision in spite of a recent Congressional Research Service (CRS) paper
predicting minimal benefits accruing to U.S. dairy sector as a result of DEIP. He said it was his desire to eventually
see the U.S. and EU issue a joint statement saying the EU will abolish export refunds and US won't reintroduce DEIP. In
the near-term, Groser believes it would be good for the advancement of trade liberalization if theU.S. and EU could
jointly agree on at least 4 or 5 basic principles that would restart momentum to resist further protectionism. Groser
added that he expected a degree of "head bashing" on DEIP at the upcoming Cairns Group meeting in Bali, but he said for
his part he intends to remain even handed.
Climate Change and Trade Policy
-------------------------------
7. (SBU) Mark Sinclair, lead trade negotiator for TPP at MFAT, noted that there was a "meeting of the minds" in the
session between NZ Ambassador Macey and Mike Froman, Deputy NSC Advisor regarding the intersection between the WTO trade
policies and Climate Change policies. According to Sinclair, Groser was pleased with the level of engagement and
feedback he got from his U.S. counterparts on calling for greater attention to be paid to the effects of climate change
produced by agriculture and cooperative efforts to mitigate. Groser also said his expectations for the upcoming Cairns
Group were measured.
KEEGAN
ENDS