Ardern confirms interest in US economic framework

Speaking to a US business summit, Jacinda Ardern has confirmed NZ interest in a major economic initiative out of Washington while calling on the US to be more engaged in the region on trade

New Zealand is set to join a new economic framework led by the United States, with Prime Minister Jacinda Ardern confirming the Government’s interest while calling on the Biden administration to consider joining the CPTPP trade deal.

Speaking at the United States Business Summit in Auckland on Monday morning, Ardern said participation in the Indo-Pacific Economic Framework would be “one big development” in the bilateral relationship.

“In the period ahead I expect we will be in a position, along with a number of others, to confirm our participation in President Biden’s Indo-Pacific Economic Framework initiative.”

Details about the framework, first flagged in late 2021, are still thin on the ground but there is a focus on four main ‘pillars’: fair and resilient trade; supply chain resilience; infrastructure, clean energy, and decarbonization; and tax and anti-corruption.

Ardern said the initiative was “not a traditional trade negotiation but it does have a trade element”, with digital trade an important area for both New Zealand and the wider world.

“It is important for New Zealand to be part of any conversation where future rules for digital trade are on the table. We have always been challenged by our distance from major markets and our small scale. Digital offers opportunities to shrink those disadvantages.”

The focus on clean energy and decarbonization also held appeal, with the Indo-Pacific region accounting for over 50 percent of global carbon dioxide emissions.

“An initiative that brings together big emitters and has an explicit climate focus has real appeal to governments like ours that want to see collective action at scale and with a sense of urgency.”

Ardern again expressed a preference for the US to enter the CPTPP deal, after Donald Trump withdrew the country from what was then known as the TPP after taking office in 2017.

“Resilience and stability in our region is not solely defined by defense or military arrangements, but relationships in many forms.”
– Jacinda Ardern

While there were commercial interests in mind on the New Zealand side, the stakes were also high for the US given its need to be “present and engaged in the economic architecture of our region”.

“Because resilience and stability in our region is not solely defined by defense or military arrangements, but relationships in many forms.”

The Government’s American counterparts were well aware of the need for engagement on the economic side, with the real question being what form that would take and how it would respond to wider geopolitical changes.

Ardern is set to lead a business delegation to the US later this month, and said the themes of her trip would include the “work from anywhere” culture which had taken off as a result of the Covid-19 pandemic, as well as New Zealand’s sustainability credentials.

“Having an electricity supply that is already over 84 percent renewable and really matters for some players in the market – as we are seeing with the big data center investments now being announced for the Auckland region. We need to strengthen these credentials and the relationships they bring.”

Asked whether she would meet Joe Biden at the White House during her time in the States, Ardern said the full program had not yet been confirmed.

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