How worried should we be over the Trump Administration’s likely impact on global trading systems and, in particular, on New Zealand exports, asks Gary Hartley of GS1 New Zealand. Make no mistake: The United States withdrawal from the Trans Pacific Partnership is a major blow to the 11 other countries involved, not least New Zealand. We began bilateral talks with the US on a free trade agreement in 2009 but folded these into the TPP process. The English Government might talk about trying to sustain the TPP with other signatories but actually, better access to US consumers has always been – and remains – the prize for New Zealand. Let’s be clear: the US is the world’s biggest and most affluent economy – and this country’s third largest trading partner. What President Trump does on trade access and on growth within the US economy really matters to us and many others. His rhetoric so far on both policy fronts is definitely alarming. That inauguration speech: “We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs.”; That promise to reward American corporates who keep production at home and to slap substantial import duties on products that compete with domestic production. President Trump’s words and first actions appear to signal the end of globalisation as developed for more than 30 years now. Border protectionism and government largess for big US companies would surely threaten trade relationships worldwide, while perhaps also shrinking the US economy. Americans would find themselves paying a lot FT236 18 FEBRUARY 2017 more for imported goods and for subsidised home-produced food, clothing, appliances and so on. Thousands of jobs might be saved in US industries but overall, economic activity would slow. US consumer demand for imports – including our red meat, dairy products and wine - would shrink, right? Maybe…maybe not. Before we as a small trade-dependent nation worry too much, here are three points of critical context around everything this new President is saying. First, Donald J. Trump sees himself as a negotiator par excellence. He believes fervently in making deals as the path to success in business and, presumably, in government. He was, after all, the author (or co-author) of the 1987 best seller, ‘The Art of the Deal’. All negotiation starts with an opening position, parts of which can be traded away later in the search for agreement with rivals. President Trump’s rhetoric is so extreme and provocative, it can easily be seen as the opening lines for some big deal-making process to follow – a process with China (back to this soon). When candidate Trump was getting extreme during the 2016 presidential election, prominent supporters urged the US media to “take him seriously but not literally”. That rule of thumb probably still applies. Second, President Trump is no political or economic ideologue but there is a consistent rationale in his words and first actions. And thanks to Kiwi expatriate (and now Trump's deputy chief of staff) Chris Liddell for helping explain this. On a home visit ENERGY MANAGEMENT SOFTWARE SOLUTION PARTNERSHIP ANNOUNCED NHP has announced its partnership with local IoT experts Switch Automation to deliver InfoSyte, an exclusive cloud-hosted energy management software solution tailored for the Australian and New Zealand markets. InfoSyte integrates with energy, water and gas measuring devices, along with other facility systems such as building management systems and heating, ventilation and air conditioning. With features such as in-built reporting, advanced analysis and trending functionality, fault detection and diagnosis, and configurable user dashboards, the platform will respond to the growing challenge of interpreting collected data for real world application use. Users will gain valuable insight into their facility operations, empowering them to identify process improvement opportunities and effective management of energy consumption. InfoSyte will be supported through NHP’s extensive distribution network and technical expertise. www.nhp.com.au/more/infosyte; or 0800 NHP NHP. Connected components: Sophisticated small-scale automation solutions • Micro PLCs and Operator Interfaces • AC Drives and Motion Control • Machine Safety Protection • Local Service and Support NHP Electrical Engineering Products NZ LTD 0800 NHP NHP | nhp-nz.com | NZFoodTech-32736 draft 2.indd 1 29/09/2016 2:21 PM last November, Liddell gave an interview in which he drew careful distinction between ‘balanced trade’ and ‘free trade’. Then President elect Trump was advocating balanced trade – trade growth but only on terms negotiated between governments, each with a clear view of its own well-defined national interests. Gone is the free trader’s assumption of win-win outcomes when countries, industries and firms compete on their comparative advantages. “We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs.”
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