United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill

I present a legislative statement on the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill. I move—

Just before you do—so that legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon TODD McCLAY: I move, That the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill be now read a second time.

It’s a pleasure to speak on this bill again. Following the bill’s first reading in April, it was referred to the Foreign Affairs, Defence and Trade Committee where it was extensively examined. The committee considered the bill from 10 April until 19 June and it recommended the bill now proceed and be passed into law. I want to express my thanks to all those involved in this important examination process, from members of the committee through to civil society and business representatives. The New Zealand - UAE Comprehensive Economic Partnership Agreement—or CEPA, as I will refer to it from now on, to shorten my speech—is a high-quality free-trade agreement (FTA) that will provide real benefits for New Zealand and for New Zealanders.

The Government recognises that trade is crucial to our economic success, and we know that one in four New Zealanders’ jobs depend upon trade access around the world. That’s why we’re focused on doubling the value of exports over 10 years, and growing our FTA network is one component of this.

We have a warm relationship with the UAE, and the CEPA is a significant new milestone towards deepening this bilateral relationship. It, along with the accompanying bilateral investment treaty, will provide opportunities to grow our trade and people-to-people links with the UAE. It provides New Zealand better access to a dynamic and internationally well-connected economy that is both an important trade and investment partner—as the world’s 20th largest economy, with GDP of over US$500 billion. The UAE is also aiming to be the world’s best-connected trade hub by 2031. This means more opportunities and increased jobs and incomes for New Zealanders. The opportunities here are considerable, and the CEPA, once in force, will improve conditions for New Zealand exporters in the UAE market, with tariffs eliminated on 98.5 percent of our goods exports immediately. This will benefit our producers of dairy, beef, sheep meat, horticulture, commodities including apples and kiwifruit, seafood, forestry, as well as all industrial items, with full tariff elimination increasing to 99 percent within three years.

On top of these high-quality commitments for our goods exporters, the CEPA contains trade facilitative rules designed to reduce behind-the-border barriers. These include commitments to release goods within clear time frames, ensuring that Customs processes and practices are transparent and as efficient as possible, and to further strengthen existing sanitary and phytosanitary measures.

Our services exporters will also benefit with the CEPA, with improved commitments in a range of priority sectors such as education, professional services like engineering and environment and audio-visual, and on top of this, most favoured nations’ commitments in the agreement in key sectors mean that our exporters will always enjoy the best available treatment in the UAE market into the future.

Other provisions agreed under the CEPA mean our services suppliers will benefit from more transparency and certainty and enjoy the assurance of fair treatment in their covered sectors. The CEPA will also contribute to a further diversification of New Zealand’s FTA network. The Middle East is a significant missing piece of the overall FTA network. Having the CEPA in place represents a crucial first step in expanding our FTA coverage in this important region as the also concluded agreement with the Gulf Cooperation Council countries will add further. This first agreement is why I, along with officials, pushed for CEPA to be New Zealand’s fastest ever free-trade agreement negotiation, concluded in just under four months. I was very pleased to sign it in January this year, during the Prime Minister’s visit to the UAE.

The importance of our network of FTAs has never been so relevant as in the current global context where the rules-based international trading system is facing challenges. Without FTAs like the NZ-UAE CEPA, New Zealand would find it harder to compete internationally. Therefore, we can’t stand still, which is why we’re doing all that we can to progress our recently concluded free-trade agreement with the Gulf Cooperation Council, as well as investing in our FTA negotiations with India.

The UAE isn’t standing still, either. Not only does it have over 20 CEPAs signed but it has commenced negotiations with over a dozen more trade partners. The NZ-UAE CEPA is the highest quality and the most liberalising of any of the more than 20 free-trade agreements the UAE has concluded to date. This is a tremendous achievement for New Zealand and will benefit our exporters greatly.

At the same time, the CEPA preserves the Government’s right to regulate in the public interest and to preserve the status of the Treaty of Waitangi through the agreement. It also contains the most comprehensive commitments on inclusive and sustainable trade of any FTA agreed by the UAE. There are a limited number of legislative and regulatory amendments that are required to align New Zealand’s domestic law with our obligations under this agreement, and the bill makes the changes required for New Zealand to implement these obligations and bring it into force. Specifically, the bill amends the Overseas Investment Act 2005 and the Overseas Investment Regulations 2005, the Customs and Excise Act 2018, and the Customs and Excise Regulations 1996.

The bill will enable an increase in investment screening thresholds from NZ$100 million to NZ$200 million for non-Government UAE investors, the designation of an authorised certification body to certify that goods originate in New Zealand, the application of preferential tariff rates under the CEPA, the implementation of obligations relating to the tariff treatment of goods returned to New Zealand after repair or alteration in the UAE, and giving effect to the rules of origin applicable to imports into New Zealand that originate from the UAE.

These legislative and regulatory changes are consistent with the changes required for almost all of our previous FTA agreements. Both the UAE and this Government are working to ratify CEPA as soon as possible to quickly realise the benefits of the agreement. Once both countries have concluded all of the necessary steps, we will be ready to bring the CEPA into force. New Zealand has secured this free-trade agreement at a crucial moment in the current global trade landscape. It will provide concrete, long-term benefits to our economy and to our exporters as New Zealand navigates the increasingly turbulent trade world we are now facing.

Can I thank all members for their work in the committee and for the extensive support across the House that this bill has received. I commend the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill to the House.

The question is that the motion be agreed to.

I rise as the first speaker on behalf of the Labour Party to support this piece of legislation, and to, firstly, thank and congratulate the Minister for Trade and Investment for what was certainly a fast trade agreement from the time of his negotiation. I would like to say that Labour, when in Government, had hosted a Minister from the UAE here in New Zealand, the Minister of State for international affairs and relations. She came over here and suggested that we start a negotiation. We went back in September and confirmed that negotiations should begin, and, in fact, we took a trade delegation to the UAE just to confirm the relationship, the value of it, and the potential from the agreement. But the Minister, on coming into Government, took up that challenge and pushed it through, so congratulations.

He did mention briefly the agreement with the Gulf Cooperation Council (GCC), which was a wider trade agreement that had actually been started under the previous Labour Government back in 2007. But it had reached a point of stalling—is a polite word, I guess. Some internal issues within the GCC meant that that hadn’t progressed with our country. The Minister, after the UAE agreement, has, as we had, started to renegotiate that, and now we have, effectively, two trade agreements with an area of the world that is growing rapidly.

It is changing, and there were submitters that came to the Foreign Affairs, Defence and Trade Committee who raised some points. Some of them related to historical areas around labour relations and, I guess, gender issues. What I’d like to say on behalf of my experience within those Arab countries is that huge progress has been made, and it’s only right that we, as a trade partner, acknowledge that through this agreement, and, indeed, encourage progress—not to be like us, but to acknowledge the cornerstones of what we’d call a “fair society”.

Trade for All was a framework that Labour laid out when in Government to ensure that any trade agreements would ensure that benefits flowed through to all areas of New Zealand society. It acknowledged gender imbalance in some areas of commerce and trade, disadvantages for Māori enterprises, labour—to make sure that we didn’t undermine labour rights in getting opportunities in trade. Indeed, this current Government—the coalition Government—has carried those through into this agreement, and we applaud them for that.

There was some suspicion, as I say, from submitters that the labour rights or labour issues within some of the countries are not what we have here in our country. We acknowledge that, but they’ve made huge progress and it’s only fair that we encourage one another, in areas of difference, to respect those differences but actually move towards what we think is a fairer society—one that does offer opportunities. This agreement does move us in that direction.

The other area of concern raised by submitters was the one of investment. Indeed, the threshold before any proper scrutiny of the investment proposals are looked at by the Overseas Investment Office, or the Minister or the Government, has now moved from $100 million to $200 million, except for areas of critical Government infrastructure and investment—the areas that we consider are still important. But moving it to $200 million is an area that is consistent with other trade agreements that we have.

One of the things that I think that we in Opposition will continue to scrutinise is the other changes that the Government is making around the areas of overseas investment. That may, in fact, not be because of this piece of legislation or this trade agreement, but because of changing Government policy that just undermines some of the scrutiny that I think most New Zealanders want to see in place. When we have a world full of trillions of dollars looking for a place to invest—and, indeed, in both the UAE and the GCC countries there is a lot of money looking to be invested, particularly in the areas of sustainable development—we’d like to think that, in New Zealand, we offer those opportunities, but we do need to ensure that the money coming in delivers sustainable benefits for New Zealand and not just for those overseas investors.

One of the other areas of concern was around the respect for Te Tiriti o Waitangi. Te Tiriti has been acknowledged in trade agreements for some time now, prior to Labour being in Government and incorporating it into Trade for All. It has been respected, and, indeed, sometimes there is some astonishment or some confusion with our trade partners when we say that we have to protect and uphold the rights of our Treaty partners regardless of the legislation, and that in trade agreements the same will apply. Through the good work of our trade negotiators and respect and understanding, those protections have been incorporated here, through to the point of data protection, intellectual property of Māori and iwi enterprises, and of Māori businesses as well—they will be protected.

So the submissions—and there weren’t that many—were mainly focused around the areas of investment, of labour rights, as I’ve said, and the protection of rights for Māori and for our Treaty partners. In our view, having scrutinised those at select committee—and I want to acknowledge the chair of the select committee and, I guess, the very fair way that we approached all of these things with an open mind. But, actually, we all came to the conclusion that this was a pretty good deal. It’s very hard in Opposition to say that it’s a “very” good deal, but it almost—almost—reaches that threshold of a very good deal, and, indeed, what it does—

Hon Mark Patterson: Grudging!

Hon DAMIEN O’CONNOR: I know it’s difficult, but I just acknowledge the work that the Minister has done. He did it in a very rapid fashion. The Government has done a number of things in a rapid fashion, very quickly. We don’t agree with many of them, but, in this particular case, when it comes to a trade agreement with the UAE, I think it delivers opportunities for that country and for our country. It will build relationships between us in commercial opportunities, and, ultimately, we hope, a more peaceful world where we can share and depend upon one another for a better outcome for all of our citizens.

Thank you, Madam Speaker. I rise on behalf of the Green Party. We will not be supporting this particular bill.

Hon Members: Aw!

Dr LAWRENCE XU-NAN: It’s in line with the fact that we didn’t support the agreement—I don’t know why the Government side is thinking that we would support the bill despite the fact that we’re not supporting the agreement. Now, there is a reason for that and I want to kind of highlight some of the reasons.

I want to, first, provide some of the context to this bill. The previous speakers have mentioned that when we’re looking at the bill itself, the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill, this is on the basis of the NZ-UAE Comprehensive Economic Partnership Agreement that was agreed on in January of this year. Yes, while I agree with the other speakers, and also with the Minister, on the fact that this was probably the fastest trade agreement deal that we have signed up to—which was only, I think, a four-month negotiation period—but a fast agreement doesn’t necessarily mean that it’s going to be a good agreement, that it’s going to be an agreement that is really genuinely beneficial to Aotearoa New Zealand. Indeed, as we were discussing in terms of the agreement that enabled this bill in the first place, there is very little evidence in terms of genuine and tangible economic benefit that we’ll be able to see as a result of this.

Yes, we talked about the fact that the Gulf Cooperation Council (GCC) is a factor in this, and having an agreement with the UAE potentially could expand on other further opportunities of a collaboration with other GCC countries.

But looking at the pure agreement itself, one of the things that we see in the agreement, in chapter two—and we’ll talk more, in terms of the details, about the increase in terms of the investment threshold from $100 million and $200 million in just a bit—as expected from a trade agreement, it’s trade of goods and services; it’s a fundamental cornerstone of a trade agreement. But the most tangible benefit of this trade agreement is a reduction of tariffs worth less than $42.6 million per annum, which, for some, they may consider it to be significant, but when we’re looking at trade agreements and the fact that our positioning in Aotearoa, in terms of the global trade potential, is worth billions and trillions of dollars, this is actually reasonably small in the context of a benefit to an agreement in terms of the expenditure that we spend negotiating the agreement in the first place. As we expected, most of Aotearoa New Zealand’s export into the UAE currently is already under the unilateral UAE duty exemption programme. The agreement is also unlikely going to have immediate commercial or economic benefits to Aotearoa New Zealand exporters as a result of that. Also, there’s no enforceable investment facilitation chapter and enforceable bilateral investment agreement which would increase investment from the UAE to Aotearoa New Zealand.

So as the agreement which enabled this particular bill stands, there are some issues. I think that the way the bill is done—which is on the basis of an agreement that has already been signed—also fundamentally highlights one of the issues we have in terms of international agreement negotiation, which is that, often, from an international law perspective, Aotearoa New Zealand operates on a dual system and not a mono system in the sense that any international treaty does not take effect unless there’s a domestic piece of legislation, which is what we’re seeing here. But what that has also meant is that it creates a loophole for Ministers to go and make these sort of deals and sign “Aotearoa New Zealand” on behalf of the people of Aotearoa New Zealand on to a deal without having the need to have any formal and substantial public scrutiny. Yes, we did have some hearings on the agreement itself, but that was after the agreement had been signed. It’s very hard for you to walk back from a contractual partner to say, “Oh, by the way, I know we signed this, but we’re now going back to our people and our people didn’t really like this particular bill.”

So there are definitely concerns. This is a concern that has been expressed as part of the Standing Orders review process in the 2020-2023 Government. The previous speaker, the Hon Damien O’Connor, has also mentioned the Trade for All report, which is supposed to address some of these concerns that we have about the lack of transparency and the lack of public scrutiny when it comes to the way we do international agreements. But what we have seen is that those recommendations have not been taken on board and we’re still continuing with the same sort of negotiation process that we’re currently seeing under Standing Orders 405 to 408. So that, from a process perspective, is one of the reasons why the Green Party of Aotearoa New Zealand find it really hard to agree to a bill which doesn’t really have that public scrutiny and accountability in the current framework.

Now, on to the bill itself, one of the things that we do see—and, again, this is sort of the issue that we have, that some of the submissions that were being made on this bill are less to do with the bill itself and more to do with the agreement that forms the foundation of this bill. Again, highlighting the opaqueness and sort of the reverse process we’re seeing when we’re looking at any international agreement, particularly when it comes to international trade agreements.

But on to the bill itself, one of the things that has been highlighted is that idea of the introduction of a type 5 investor, and this is something we can discuss more in terms of the committee of the whole House stage. But the fundamental element—and this is something that the select committee was very interested in, and, again, I do thank the Foreign Affairs, Defence and Trade Committee, and particularly the members on that select committee, for us to be able to have that really curious but really open discussion in terms of this particular type of investor and then really allowed us to have this opportunity to ask officials about some of the examples and the reason behind the increase of the investment amount from $100 million to $200 million.

I think one of the things that I wanted to highlight from that particular consultation period during the select committee was around the fact that we were curious as to what that process actually looked like. What is the process for investment screening? Who is responsible for investment screening? This is something that we have seen expressed through the select committee report around the fact that all screening for investment in New Zealand is undertaken by Land Information New Zealand—LINZ—and also under the Overseas Investment Act. Under the Overseas Investment Act, LINZ has the mandate to consider screening significant business assets that are generally defined as assets valued at more than $100 million. But what we’re seeing for this particular bill and for this agreement is investments from the UAE will need to meet a threshold of $200 million before they are being screened. So that is, fundamentally, the most significant change to the legislation through the select committee process, at which it was discussed at length, because the rest of the bill is more to do with adding additional amendments to take into consideration of agreement.

Now, I would like to draw attention to a particular submission to this bill, which is by the New Zealand Council of Trade Unions, which does oppose this bill. But it’s more than that; it opposes the agreement itself and it highlights something that we have spoken about when we’re talking about the agreement, which is the concerns over the labour right violations that the UAE is currently having. It really questions in terms of what we are willing to sacrifice as people of Aotearoa New Zealand who uphold workers’ rights—allegedly; not under the current Government. But what does that actually look like internationally? How can the International Labour Organization—and the international agreement that we signed up to is manifested through our trade agreements.

One of the major concerns is around the fact that when we look at the agreement itself, as the submitters mentioned, the trade and sustainability development chapter is not enforceable. That is a problem because it says it shall endeavour to adopt and maintain the principles concerning the fundamental rights at work. Yes, we do see that over the last few years. I agree with the previous speaker on this that we have seen some changes to the way that the UAE functions in terms of the way that their labour rights have worked. However, what we’re still seeing are major loopholes and major gaps for, particularly, migrant workers who are working in the UAE and what that will mean for them. So when we are importing things from the UAE, are we looking at potentially feeding into some of those international labour right violations? Which I think is a key consideration.

So, with that, the Green Party will not support this bill, because the Green Party does not support this agreement.

Thank you, Madam Speaker. I rise today in support of the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill—and I did have to read that, because I know we don’t like using acronyms. The ACT Party supports this bill. It’s a huge honour to stand here and say that this Government, and particularly the Minister, have got an agreement over the line in almost record time. I think it sends a signal that—

Tim Costley: It’s almost very good!

LAURA McCLURE: Oh, almost—almost record time. Actually, it could be record time—maybe we need to check that out.

What I think it does is it sends a signal that New Zealand is a tiny island nation at the bottom of the bottom of the earth, and part of our prosperity is the fact that we are able to trade, and these agreements are really important to New Zealand’s economy. It signals two things. It signals that we need to diversify our markets. We need to trade more with other, yes, like-minded partners, or partners that are of significant economic opportunity for us.

Part of the select committee process was hearing from submitters, and, like the previous speakers have said, there were some concerns about labour issues. I do hear those concerns. I think the United Arab Emirates UAE is making rapid improvements, it’s becoming quite a modern society, and it’s one that we do really want to trade with. But we also need to think about some of our other trade agreements that we have with other partners, and I think it is a bit contradictory to bring up labour rights issues when we know that those are things that, actually, some of our other trading partners have as well.

Yep, this is, potentially, of small economic benefit right now, which I think the previous speaker, Dr Lawrence Xu-Nan, talked about, but it’s actually the opportunities that this presents for our markets here and what it could actually bring in. So, while the immediate economic benefits may not be that huge, what it does do is it opens up a whole bunch of opportunities for our exporters and potential exporters from the UAE to come into New Zealand—whether that is investment, for example, they are things that we want and we need more of.

The bill does technical things that all trade agreements do. This one, obviously, raises the investment screening threshold from $100 million to $200 million. It does things like the certificate of origin, the tariffs, the rules, etc. These are all the things that are the basics of implementing any type of free-trade agreement, and the ACT Party supports more of this. I commend this bill to the House.

I will use the acronym. We absolutely support the UAE trade deal. This is a really important step forward, and, in record time, this deal was pulled together by Minister McClay, and we absolutely commend him for doing that, and in under four months—a fantastic performance.

Look, it is absolutely critical that we diversify our trading options. It’s clear for all to see the geopolitical tensions at the moment, and the ability to trade as broadly as possible and our goals of growing the economy and doubling our exports are an important component of that for New Zealand. So deals like this are critical, and the UAE would seem—quite a synergy between them and us. Food security: we’re hearing more and more, as our Ministers go out into the world, about food security being something that’s increasingly on the radar, and that’s something that we are able to offer some of these international countries like the UAE. So there’s certainly something in it for them. I mean, the good thing here is it builds upon—this is not in isolation; it builds on the Gulf States deal, it builds on the EU deal, it builds on the UK deal. Minister McClay’s been heavily involved in that. I acknowledge one of the previous speakers, the Hon Damien O’Connor, who did a lot of the legwork for the EU and the UK deal. We’ve got the India deal going at the moment—that’s going to be critical as we go forward.

I do wish the Greens would reconsider their position. We cannot, as a country, tax ourselves to prosperity. Day after day, you get up here and demand Government spending. We’ve got to earn it somehow, and deals like this are exactly how we’re going to earn our way in the world and lift our standard of living and our ability to deliver those Government services that you are rightly demanding are increased.

The other thing I did want to say here is that there is a gentleman called Vangelis Vitalis—who many of us will know—that is New Zealand’s lead trade negotiator. He would be one of the most incredible New Zealanders in terms of his service to New Zealand and the value that he’s brought to our country, and our primary sector in particular, through these trade deals. He is an extraordinary operator, and we are very lucky to have him—and whilst it’s the politicians that take the credit, it’s the people like Vangelis that do the groundwork and get these deals over the line for us.

The substandard part of this deal from our perspective—what we’ve, not given up, but in terms of what we’ve offered up in return—is increased investment in threshold for the Overseas Investment Act provisions from $100 million to $200 million. That seems a sensible matter; it’s in line with our other trade agreements. It still gives us the ability to scrutinise large strategic purchases, and we haven’t traded that away. We’ve just lifted the threshold, and the UAE is now a trusted partner in that regard, to bring them into line with some of these other trusted international partners that we have.

So New Zealand First absolutely supports this bill. It’s fundamental to our going for growth. It’s fundamental for us growing our exports—doubling our exports. So we absolutely commend this bill to the House.

The next call is a split call.

Thank you, Madam Speaker. So the Green Party is not supporting this bill. For those of you wanting a robust analysis of our position, you can reference my excellent colleague Dr Lawrence Xu-Nan’s speech, in which he laid out the broad-ranging aspects of this comprehensive economic partnership agreement that we are signing up to as part of this legislation allows that to, basically, come into place. I wanted to focus on a few specific aspects, within my role particularly as immigration spokesperson and as somebody who has worked really closely with our Sudanese counterparts.

First of all, I want to make it clear that the Green Party is not inherently against trade deals. In fact, we recognise that, actually, trade deals that build on mutual respect and aspirations that uphold the rights of people in both countries can be beneficial. But we also need to be aware of the breaches to human rights that may be occurring in the counterparts that we are signing trade deals with. I think particularly of the conflict in Sudan, which has been described by many people as one of the most horrible humanitarian incidents that we’ve had, and with the United Arab Emirates’ complicitly in enabling some of that to happen. I think there is a lot of concern around us not holding our trade partners adequately to account. This is something that we raised in our differing view. I do want to mihi to the Sudanese diaspora, recognising that many of them actually do live in the United Arab Emirates, and who struggle to voice their concerns in relationship to the United Arab Emirates’ complicity in some of these issues.

As my colleague noted in the differing view when he tried to ask around, for example, the concerns on this issue, what we received was that the Ministry of Foreign Affairs and Trade (MFAT) was not able to accurately articulate how this trade deal could hold both parties accountable for serious human rights and armed conflicts. I think, to me, that’s a really important issue to resolve.

Other submitters—and I want to pick up on the New Zealand Council of Trade Unions—also talked about the United Arab Emirates’ poor record of appalling international labour rights and standards in relation, as well, to how the ratification of this agreement does not help move us closer to the International Labour Organization commitments to address modern slavery. The United Arab Emirates is one of the countries that probably is most notorious for having guest worker visa schemes that do entrench migrant worker exploitation.

When I hear other members talk about how trade can boost our economies, we’ve also got to think about who is benefiting from the increase in, for example, GDP that we may be seeing as a result of these trade deals. In the United Arab Emirates, we know that many of the migrant workers and low-wage workers are not benefiting to the degree that they should from the economic gains that they have seen in their country. We know here that we also have issues to address relating to who is benefiting the most from the trade deals that we’re signing up to. That includes, for example, making sure that our farmers are looked after as we continue liberalising, basically, the arrangements that we have with other countries and we talk about slogans like boosting our agricultural exports. I think that needs to centre, actually, issues around sustainability, looking after workers, etc.

Again, I want to reiterate that the concerns that we have in relation to this piece of legislation stem from particularly the inability to adequately take seriously and address the human rights issues that exist within the UAE and also the inability to give effect to Te Tiriti o Waitangi and protect Māori sovereignty, which was never ceded, as part of these trade agreements—something that has been a longstanding issue for the Greens in trade deals that we’ve signed up to, both in Labour and National Governments.

I think, to me, this signals that, actually, we do need to do more work as a Parliament and in Governments to ensure that the trade deals that we sign up to actually enhance the rights of people across both nations. That they do not just benefit the companies that are already doing well at the expense of, potentially, workers that are currently being exploited, whether it’s on shore or off shore with the partners that we’re signing up with. We look forward to having constructive conversations across the House and with communities on the ground to ensure that we can build trade deals that genuinely uphold principles of sustainability, economic equity, and indigenous sovereignty. So, for those reasons, we won’t be supporting this bill.

Tim van de Molen: Point of order. Madam Speaker, just seeking to clarify that I am not taking the other half of the split call.

DEPUTY SPEAKER: No, it’s your call.

Tim van de Molen: Correct.

DEPUTY SPEAKER: Yes. Thank you.

With the United Arab Emirates close economic partnership agreement, it’s fantastic to see this bill now coming back for the second reading. As we heard from the Minister for Trade and Investment, trade agreements for New Zealand are vital. As an export-oriented nation, this is essential for our long-term prosperity. With an ambitious goal of doubling the value of exports over the next 10 years, new agreements like this become even more important. So to see it progressed in record time was fantastic.

As chair of the Foreign Affairs, Defence and Trade Committee, it’s been a privilege to help guide this through its process in that committee, and I particularly want to thank the members of the committee for their efficient and effective consideration of this bill, and Opposition members in the Labour Party in particular, acknowledging that no deal is quite perfect but, actually, this is a very good deal—I will take Mr O’Connor’s concession on that regard—and it will be a fantastic benefit for the country.

We’re very pleased to see this progressing with near unanimity. It would’ve been great if we could’ve had unanimity across the House, but we’ve got to a very good position on this and we’re very pleased to see this progressing. So I commend it to the House.

Thank you, Madam Speaker. I, too, stand in support of the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill. A little bit of context with respect to some of the submissions on the matter of the Treaty of Waitangi clause. I want to acknowledge their taumata and the other submitters that came forward in what, for some or an outsider looking in might see those submissions as being prickly or against. But, actually, what they’re doing is building on a legacy of continually challenging the Government, regardless of whether it’s a Labour-led Government or a National-led Government, to try and push for the recognition of the Treaty of Waitangi in the pieces of work and the negotiations that are done on trade.

They have had success in the past. We know that in particular with the UK. If I recall correctly, it might have been the first time or unique for its time. With respect to this particular deal, we did hear from the submitters about how they might look towards pushing the envelope, if you will, on the recognition of the Treaty of Waitangi rights and what does that mean. I thought the officials gave a really good, fulsome response about how, through the indigenous connections that Māori, who are already trading in the United Arab Emirates and other places around the world, that indigenous connection with those particular countries have seen trade continue to grow and flourish. With the addition of Treaty of Waitangi discussions in negotiations, it’s allowed for a really good recognition, and I think another good stepping stone as future trade agreements are considered by this Government and future Governments.

Just to provide a bit of context with that, because, as I say, if some look at those submissions from those particular people, they might actually think they were in opposition to it, but, really, what they were trying to do was just continue to challenge to make sure that those indigenous rights aren’t forgotten and that the Treaty of Waitangi takes its place in recognising that Māori continue to trade around the world—they have a significant role to play in the primary products space, which is why it’s important that we continue to recognise that.

The other part that my colleague, I think, summarised quite well around lifting the investment threshold is that it is important that we get good investment into this country. It’s just as important that we make sure that there is strong accountability mechanisms when we look at how money comes into this country, what’s being invested in, where that money comes from, and in what way that money comes into this country is a really important question that not only this House should be asking but I know people across the country are asking, as foreign investors look to invest in this country. We know there’s a push for foreign investment in this country. We know it’s important to continue to grow our economic outlook into the future. But we must make sure that there are accountability mechanisms there.

I thought my colleague the Hon Damien O’Connor pointed to some of those matters and things that we’ll continue to interrogate, regardless of our support for this bill or for any other negotiation that’ll look towards bringing foreign investment into this country. We know that land is precious. We know that it’s a taonga and a resource for our country, and we want to make sure that it continues to be that into the future.

Without further ado, I do commend this bill to the House, and I look forward to making sure that the work of this committee continues to interrogate and do very collegial work on trade matters and foreign affairs matters. Thank you, Mr Speaker.

Oh, thanks, Mr Speaker. Look, just in lieu of the time and to keep things moving, I just want to cover one aspect which was touched on briefly by the Minister for Trade and Investment, which is around the investment screening threshold lifting from $100 to $200 million. It was an area that I interrogated and it didn’t seem to have been something people had looked at particularly much previously through select committee processes around how this works, as it was explained to us. I think that it’s important that we get this right. It applies where the purpose of the business coming to New Zealand in that investment is specifically to facilitate trade in relation to this economic partnership, and I think that is important.

There is a team that monitor this. I want to particularly acknowledge Pedro Morgan, who’s the lead adviser to overseas investment at Land Information New Zealand, who I think did an excellent job advising the Foreign Affairs, Defence and Trade Committee, and I think deserves to have his name in Hansard. It was excellent advice that we got and it gives you real confidence in the public servants that look after us and monitor these processes to make sure Kiwis are getting the best deal. There’s a great team in place to look after it. With that, I commend this to the House.

Thank you, Mr Speaker. It’s a pleasure to rise, like my colleagues, in support of this bill, and to commend the Minister for his quick work in the context that my colleague Damien O’Connor mentioned, which is that there were essential early conversations that were begun by the last Labour-led Government as well. I think the Minister made a useful comment, which was that these are unusual times in trade, and so I do think that it’s an important time to ensure not only that we’re maintaining our trade relationships; that we’re diversifying them—and certainly, that we’re managing risk in these unusual times.

I didn’t have the pleasure of sitting on the select committee considering this bill. However, I have been through some of its provisions and the provisions of the agreement, and I did think that they were substantial in terms of the immediate removal of tariffs on considerable areas, including dairy products, industrial products, horticulture, red meat, and poultry. One of the interesting points within the agreement itself, I thought, was in relation to the tariffs regarding wine, which, while they’re not as substantial as the others—New Zealand exports to the UAE total about $7 million—the tariffs on wine were 50 percent, so the effect of the agreement is, essentially, to reduce them to 10 percent. But the novel factor of the agreement is it futureproofs New Zealand producers and exporters. So if other parties are offered liberalisation of tariff regimes, New Zealand would still get the benefit of at least those liberalisations, as well. I thought that was an excellent example of how we ought to be negotiating trade agreements in terms of futureproofing them.

As others have spoken to, this isn’t the first trade agreement that the UAE have entered into. Just this year, Malaysia, Kenya, Ukraine, and the Central African Republic have also been countries that the UAE have entered into trade agreements with. They have very much had a focus of shifting away from oil being the chief export for them, into looking at logistics, sport, tech, and tourism as well.

I do want to acknowledge, as others have, the submissions of the New Zealand Council of Trade Unions. I think it is tempting to want all of our trade agreements to evolve on the same plane, with the same requirements in terms of our worldview. However, that’s not always going to be possible, and I agree with my colleague the Hon Damien O’Connor that we must continue to engage across the globe, continue to develop our relationships, and, where there are opportunities for ongoing conversations, to have those conversations actively.

I did want to make a comment on the rules of origin, which, to my mind, are the real anchor of a trade agreement. If they’re overly broad, there’s a risk of trade diversion, so one country importing goods and simply onselling them, and if they’re too onerous in terms of defining what a rule of origin is, then at times that can be seen as defeating the purpose of ensuring smooth trade. So getting that balance right is really essential, and I do note that, in terms of this agreement, there is the ability for entities who are approved to self-determine that origin—or self-certify, if you like. That’s not unusual for New Zealand; we have a similar rule in terms of Australia, as well. However, I do think that that is one area where, going forward, when we are reviewing our agreements, we ought to look whether that rule is still serving us. Likewise, the investment threshold, as others have spoken to.

So the critical issue there is whether, when Land Information New Zealand (LINZ) is assessing the threshold, whether multiple lower amounts that constitute over $200 million are counted as one or not, and whether LINZ ought to have discretion in terms of how they make that assessment.

So there are things that we will need to keep an eye on. But overall, like colleagues, I agree that this is a really good way for New Zealand to move forward, and I commend this bill to the House.

Thank you, Mr Speaker. It’s a pleasure to rise in support of the United Arab Emirates Comprehensive Economic Partnership Agreement Legislation Amendment Bill. This is progressing the process so that we can ratify the agreement that has been made, and I commend the bill to the House.

Debate interrupted.