Good morning all and Happy New Year.
I'm back on deck after a month away on holiday overseas and am resuming the Hive News emails daily from today. I'm glad to have missed the Wellington 'summer'.
I'm now working on a transition plan to replace Hive News with Newsroom Pro over the next month or so as we build up the Newsroom operation. I plan to keep producing the Hive News email for the next four weeks and will contact customers to offer an improved Newsroom Pro subscription as we approach the end of the Hive News emails. The Newsroom Pro service will provide an expanded and more in-depth coverage of the political economy and Government. I will update everyone with more details as we get closer to the end of February.
Meanwhile, Bill English held his first post-cabinet news conference yesterday afternoon and focused on New Zealand's options for trade agreements in the wake of Donald Trump's formal withdrawal of the United States from the Trans Pacific Partnership (TPP) .
He still hopes something can be salvaged from the TPP and talked up the prospects of a US-free TPP where the remaining 11 partners agree a new trade deal. He said he was encouraged about the TPP's prospects from discussions with Singapore's Prime Minister Lee Hsien Loong on his return back to New Zealand from talks in Europe and Britain, and by initial comments from Japanese Prime Minister Shinzo Abe.
English said he had asked Todd McClay to prioritise ongoing discussions with other TPP members to see what can be salvaged.
However, those hopes receded further overnight when Japan formally rejected an Australian proposal for a TPP where China replaced the United States.
Japan's Deputy Chief Cabinet Secretary, Koichi Hagiuda , told reporters in Tokyo that Japan was not considering going ahead with the Australian proposal.
"Without the U.S., the TPP pact is meaningless, as Prime Minister Shinzo Abe has clearly said," Hagiuda was quoted as saying by Japan Times.
"The fundamental balance of interests is lost without the U.S," he said.
Japan's main interest in the TPP was in getting better access to America's car parts market. Without that carrot, there remains few benefits for Japan to obtain to offset the pain for its powerful agricultural lobby. The same can be said for Canada, which would be the other major prize for New Zealand in any TPP.
English said he had also asked McClay to travel to the United States for a meeting with Trump's (yet to be confirmed) U.S. Trade Representative Robert Lighthizer about the potential for a bilateral deal with the United States, given Trump has said he wanted bilateral deals with the TPP partners where American interests were put first.
New Zealand would struggle to get near the front of the queue, given its size. It also has little left to trade away, apart from intellectual property rights around drugs, movies, music and books, as it has already lowered tariff barriers to all on almost all products.
However, English acknowledged later in the news conference that an acceptable bilateral deal with a Trump-led America was unlikely.
"Any bilateral deals would be attractive to us in concept, but as he's made clear, he would expect it to have significant benefits for the US," English said.
Asked how realistic a bilateral deal was, he said: "If you asked me that today, there's no chance of that happening in a form that we'd find satisfactory, but we wouldn't want to rule it it out, any more than we'd want to rule out other versions of progress on free trade with TPP."
"Bear in mind it's not the only game in town for us. We've got the European Union discussion going on. You've got this (China-led) RCEP agreement with Southeast Asia, which up to now has been on a bit of a slow burn, but you might find the political will for that to pick up speed if TPP isn't going to proceed," he said, pointing also to positive comments from Japan's Abe about TPP (albeit before last night's rejection of Australia's proprosal.)
English is already looking ahead to a time when Trump is not in charge and where America could rejoin the TPP process.
"In the long term the US may want to be part of the TPP, or a TPP-type agreement, and therefore continuing it on in its current form with the already negotiated U.S. positions in it, would make that more likely in the future," he said.
"We've always wanted a bilateral, but they've made it clear with their rhetoric that they'd expect America to come out of any deal ahead of the other partner."
Election date soon
Elsewhere in the news conference, English said he expected to announce the election date "fairly shortly, once I've had the opportunity to inform my caucus colleagues."
He later said the date had not been finalised and he expected to make an announcement in the "coming days or weeks." National's caucus is due to hold its first all-day meeting of the election year next Wednesday in Wellington.
In other economic news...
Michael Woodhouse announced a 50c/hour or 3.3% increase in the minimum wage to NZ$15.75 from April 1.
BusinessNZ and BNZ reported their Performance of Services Index survey of the services sectors found a slight acceleration in expansion in the sector. The index rose 0.3 points to 58.4 points in December from November. Any reading over 50 indicates expansion.
Have a great day.