Dialogue: NZ trade lobbyists get ear of President

By FRAN O'SULLIVAN

When five United States Congressional chairmen endorsed a letter to President George W. Bush encouraging him to launch negotiations, the move was the most significant step yet in New Zealand's bid for a free trade agreement with the US.

Getting on the Washington agenda is hard enough for large countries.

But for New Zealand's diplomatic lobbyists - led by Washington Ambassador Jim Bolger - the Bush letter counts as a minor coup in a protracted effort to obtain a closer economic partnership with the US.

Signed by 21 key Congressional members, the letter emphasises New Zealand's commitment to democratic values and a strong partnering role with the US in expanding trade liberalisation.

Importantly, it also emphasises the fact that trade between the two countries has doubled in the past 15 years to more than $US4 billion this year, with the US now New Zealand's second largest trading partner.

Bolger is, of necessity, a backroom player in the current New Zealand drive for a free trade agreement with the US.

His former National Government's push for a similar deal foundered when former US President Bill Clinton was denied fast-track authority to negotiate trade agreements.

This week he was quick to pass the credit to other players - particularly Fred Benson, newly placed in the role of president of the US-NZ Business Council, and Republican Congresswoman Jennifer Dunne.

Benson is a former vice-president for federal and international affairs with forestry giant Weyerhaeuser, and as such is on first name terms with many key Washington players.

Dunne, with trade subcommittee chairman Phil Crane, deserves primary credit for rounding up bipartisan support from 19 other representatives before the President departed for the summer recess.

Dunne's action places the New Zealand free trade agreement "right in the centre of the US Government."

US Secretary of State Colin Powell is also in New Zealand's sights.

Powell recently signalled that the US was prepared to consider a bilateral trade agreement with Australia.

This week Benson wrote to Powell on behalf of US companies investing in New Zealand, requesting support for the proposed FTA negotiations to start this year.

"The trade barriers are low, the relationship on a sound footing and the ease with which an FTA could be achieved is well understood," he wrote.

Benson believes an agreement could easily be struck given the strength of the relationship between the two countries. But it must become a "common goal".

He is building strong support among US companies with interests in New Zealand to support the FTA initiative.

A strong selling point is the fact that no other country has consistently worked more closely with the US in multilateral and regional trade forums such as Apec and the WTO.

But, as with Australia, although the benefits to New Zealand from US free trade agreements are generally well understood, there are hurdles.

In Washington last May, Agriculture Minister Jim Sutton suggested that New Zealand could entertain a phase-in period for the reduction of US protection in areas such as dairying.

But the powerful American farm lobby - and the politicians it canvasses - will not be moved easily.

Australia and New Zealand have already been in a protracted dispute with the US over lamb subsidies. The WTO has ruled against the US, but the remedy has been slow to come.

There are also outstanding defence issues. Unlike Australia, New Zealand no longer enjoys direct ally status with the US; it is seen as a friend.

But it is a longstanding friend, nevertheless, which has stood as one of the US' strongest allies in all the major conflicts of the last century, as the Congressional letter to the President emphasised.

Bush has made free trade a central plank of his presidency.

A major stumbling block to a US free trade agreement - with New Zealand or any of the others queuing at the President's door - is Bush's need to get trade promotion authority from the Congress.

Such authority allows trade deals to be submitted to Congress for a simple yes or no vote without being subject to amendments.

Bipartisan support already exists within the Senate for the measure.

But differences between the two major parties over the extent to which the authority should cover labour and environment issues has been a hindrance to building majority support in Congress.

Republican House majority leader Dick Armey last week postponed plans for a vote on the enabling legislation, citing the failure to get sufficient Democrats on board.

Republican lobbying is expected to start again after the summer recess finishes.

But until the President has trade promotion authority, the ability of the US to play a leading role from global trade talks through to bilateral agreements, such as New Zealand's proposal, remains constrained.