No TPP deal unless dairy and Pharmac are in, says Key

New Zealand will not sign up to the Trans-Pacific Partnership free trade deal unless it includes an agreement to progressively abolish tariffs on agricultural products exported to North America, Prime Minister John Key said today.

With international negotiators for the trade pact due in New Zealand next week for the next round of talks on the TPP, Mr Key also said it would "not a good look" if New Zealand made concessions that undermined the status of its drug-buying agency, Pharmac.

TPP opponents charge not only that the negotiations are too secretive, but that they are being driven by American companies' desire to exert greater control over US intellectual property in third markets.

Pharmac, which buys medications distributed through the public health system, has been a target of "big pharma" American drug manufacturers, who object to the fact New Zealand is sourcing lower-cost generic pharmaceuticals which save the taxpayer money, but deny sales to the American producers of the original drug formulations.

Mr Key gave no detail of New Zealand's negotiating position at his post-Cabinet press conference in Wellington, but said New Zealand was "not prepared to see dairy excluded" from the deal.

Both Canada and the US impose high tariffs - as high as 300% in some cases in Canada - along with small quotas for total imports, and US dairy farmers have lobbied vigorously against opening their market up to competition from Fonterra, which they paint as monopolistic and anti-competitive.

"For New Zealand to do a deal, it has to be a deal on our terms," said Mr Key, who met with TPP countries' leaders, including re-elected US President Barack Obama, on the fringes of last week's East Asian economic summit, where a new commitment was made to conclude TPP negotiations in 2013.

New Zealand was a prime mover in establishing the TPP initiative in 2007, which the US later joined, and which has become a priority for the Obama administration as it seeks to engage more deeply with the Asian region and to stimulate its own economy.

"President Obama is deadly serious about wanting to do a deal," Mr Key said. "He believes he can get a deal done."

But New Zealand could not sign up to a deal that excluded dairy exports, the country's largest industry.

Following the US elections earlier this month, Mr Obama's Democratic Party controls the US federal Senate, where much opposition to TPP has come from in the past, although the Republican Party controls Congress, the US Lower House of Representatives.

Other TPP negotiating nations are Singapore, Australia, Mexico, Brunei, Chile, Peru, Vietnam and Malaysia, with Thailand signalling at least week's summit in Cambodia that it also wished to join. Japan is also continuing to show interest.

At the same meeting, New Zealand signed up to negotiation of a separate trade pact, the Regional Economic Co-operation Partnership, which includes the countries of the Association of South-East Asian Nations and China, but not the US.

However, RCEP is seen as likely to take longer than TPP to conclude and is less committed to what trade negotiators call a "high-quality" agreement which seeks to limit the extent of special exclusions to meet member countries' trade sensitivities.

Opponents of the TPP are conducting briefings in Wellington and Auckland this week, in concert with the Green Party.


6 · Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

Post Comment

6 Comments & Questions

Commenter icon key: Subscriber Verified

The US media lobby are pushing US trade representatives to ensure their own copyright extremist agenda is included in the TPP, based on leaked draft versions of the TPP. These same extreme copyright ideas cannot get enough votes to get past the US House of Representitives when it was included in the SOPA (Stop Online Piracy Act) within the last 12 months. Getting these extreme copyright terms included in the TPP will effectively bypass the democratic route the US media lobby has previously tried and failed at.

With rose-coloured glasses our money dealer PM is being charmed by the US media lobby that the media creation industries need greater protection than other industries and that laws and treaties need to be past so that tax payers and technology industries should subsidise policing what has always been a civil not a criminal matter.
Case in point, the New Zealand government will spend over $10 million advancing US media and FBI interests before the situation is wrapped up here in NZ. All the while the matter could and arguably should have been dealt with as a civil matter at the expense of the media companies who claim to have been wronged.

The proposed TPP copyright extremist provisions are wrong because they propose to shift the burdon of resolving civil disagreements between competing corporate entities to being criminal and taxpayer funded. All the while, the taxpayer is getting nothing in return for having to pay for the cost of protecting an industry that is wealthy enough to pay for its own legal battles.

  • 0
  • 0

NZ dairy products tariff-free in to the US? Pigs will fly.
So Key is saying the TPP will not proceed with US involvement?

  • 0
  • 0

The only thing TPP will achieve is a one-way flow of Kiwi earnings into overflowing American businessmen's pockets. The bargaining chips of dairy and Pharmac were carefully included up front so that Key could negotiate them back to claim some sort of "win" for New Zealand. The whole TPP is flawed and will do no good for average Kiwis, while providing lots of wealth to certain sell-outs to America... Like John Key, who wants desperately to be new American rich kid.

  • 0
  • 0

Please, folks, remember that the US was not originally involved. They are now only to derail the process as they won't give up their agricultural tariffs and subsidies. Hence, the twin track to leave the US out - looks smart to me!

  • 0
  • 0

Translation... TPP will fail.

  • 0
  • 0

"Mr Key also said it would "not a good look" if New Zealand made concessions that undermined the status of its drug-buying agency, Pharmac."

Translation from Keyspeak to english: Pharmac will be gone by lunchtime.

  • 0
  • 0

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot


Sym Price Change
USD 0.7284 -0.0014 -0.19%
AUD 0.9192 -0.0012 -0.13%
EUR 0.6091 -0.0020 -0.33%
GBP 0.5364 -0.0010 -0.19%
HKD 5.6867 -0.0084 -0.15%
JPY 81.4110 -0.6400 -0.78%


Commodity Price Change Time
Gold Index 1290.6 -9.820 2017-09-21T00:
Oil Brent 56.1 0.160 2017-09-21T00:
Oil Nymex 50.5 -0.130 2017-09-21T00:
Silver Index 16.9 -0.316 2017-09-21T00:


Symbol Open High Last %
NZX 50 7795.4 7814.8 7795.4 0.25%
NASDAQ 6448.6 6448.6 6456.0 -0.52%
DAX 12602.0 12621.3 12569.2 0.25%
DJI 22414.0 22419.5 22412.6 -0.24%
FTSE 7271.9 7289.2 7271.9 -0.11%
HKSE 27949.8 27960.9 28110.3 -0.78%
NI225 20413.6 20417.1 20347.5 -0.21%
ASX 5655.4 5688.2 5655.4 0.45%