Latest / The SME Stream / What a Trump win means for NZ: ‘The devil will be in the detail’

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What a Trump win means for NZ: ‘The devil will be in the detail’ · The SME Stream

• 0:05
  Speaker 1: Kyota.
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  Speaker 2: I'm Chelsea Daniels and this is the Front Page, a
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  Speaker 2: daily podcast presented by The New Zealand Herald. Donald J.
• 0:18
  Speaker 2: Trump will become the forty seventh president of the United
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  Speaker 2: States of America.
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  Speaker 3: This will truly be the Golden Age of America.
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  Speaker 1: That's what we have done.
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  Speaker 2: Democrat Kamala Harris called the former president to congratulate him
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  Speaker 2: and offer their support for a peaceful transition of power.
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  Speaker 4: A fundamental principle of American democracy is that when we
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  Speaker 4: lose an election, we accept the results.
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  Speaker 2: Trump won't take up office until January twenty next year,
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  Speaker 2: and there are a few things that will happen between
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  Speaker 2: now and then. He faces sentencing for his felony conviction
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  Speaker 2: for a start that's put down for November twenty six.
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  Speaker 1: A judge, though, could.
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  Speaker 2: Decide to throw it out before then. There are then
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  Speaker 2: some formalities like appointing some four thousand political positions in
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  Speaker 2: a new administration. And it'll be next year when the
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  Speaker 2: idea of tariffs will come to the fore, but it's
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  Speaker 2: something the rest of the world is already anticipating. On
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  Speaker 2: the campaign trial, Trump promised anywhere from ten to twenty
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  Speaker 2: percent tariffs on imports. So what does that mean for
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  Speaker 2: New Zealand exporters, especially given the US is one of
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  Speaker 2: our biggest trading partners. Today on the front page, Beef
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  Speaker 2: and Lamb and Z chair Kate Ackland is with us
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  Speaker 2: to discuss.
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  Speaker 1: But first we speak.
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  Speaker 2: To nzed US Council Executive Director Fiona Cooper about our
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  Speaker 2: blossoming relationship with the United States and why we should
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  Speaker 2: probably all take a deep breath. First off, Fiona, what
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  Speaker 2: was your initial reaction to the US election result.
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  Speaker 4: Well, it's been a big build up and it was
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  Speaker 4: quite dramatic it. You know, we were watching all the
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  Speaker 4: polling of the polls and it became a very strong
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  Speaker 4: result for Trump. We went sure where we're even going
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  Speaker 4: to get a result on the night, So I guess
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  Speaker 4: that's one good thing is that there's a clear outcome
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  Speaker 4: and hopefully that paves the way for, you know, a
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  Speaker 4: smooth transition of power.
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  Speaker 2: What's our relationship with the United States like.
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  Speaker 4: Well, this is the very good thing is that we
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  Speaker 4: have an excellent relationship. It's been growing. You know, it's
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  Speaker 4: strong in terms of trade and it's strong right across
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  Speaker 4: the board. And New Zealand worked very well with President
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  Speaker 4: Trump's first administration, our Foreign Minister Winston Peters, he had
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  Speaker 4: strong relationships with his counterparts and he was very engaged
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  Speaker 4: with them. And in fact, I certainly am delighted to
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  Speaker 4: see that the Prime Minister and Foreign Minister Peter's were
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  Speaker 4: quick to welcome the result last night and congratulate President
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  Speaker 4: Trump on his victory. I think that's good. So, you know,
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  Speaker 4: New Zealand's not starting from scratch. We have worked with
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  Speaker 4: Trump before and we look forward to working with them again.
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  Speaker 2: Well, the New Zealand US trade relationship topped twenty seven
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  Speaker 2: point five billion in twenty twenty three. That's no small feet, hey,
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  Speaker 2: And it's getting bigger and bigger every year, isn't it.
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  Speaker 4: Certainly it's now our second largest export market. It's valuable,
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  Speaker 4: it's growing, and that's a really good news story because
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  Speaker 4: New Zealand companies who export to the United States, they
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  Speaker 4: are well known for having high quality, innovative products that
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  Speaker 4: United States consumers want and that US businesses use in
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  Speaker 4: their manufacturing. So it's a really good news story. We'd
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  Speaker 4: like to see that continue and we look forward to
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  Speaker 4: sharing that story with the new administration.
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  Speaker 2: When it comes to tariffs, though, that's the thing that
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  Speaker 2: has been a stickler for basically every country in the world.
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  Speaker 2: When looking at the results and looking at this election,
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  Speaker 2: we actually don't know anything about them really yet, do
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  Speaker 2: we No.
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  Speaker 4: You know, there's not room for a lot of nuance
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  Speaker 4: in election campaigns, so all we've seen is very high
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  Speaker 4: level talk about imposing a universal tariff. But we don't
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  Speaker 4: have any details, and I would caution against speculating about
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  Speaker 4: the tariff policy until it's more fully formed. Trump won't
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  Speaker 4: be sworn in until the twentieth of January, so we're
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  Speaker 4: not going to find out the detail until after that.
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  Speaker 4: But the policy details do matter, and we'll be looking
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  Speaker 4: at it very closely once it's known. You know, the
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  Speaker 4: devil will be in the details. It's clear there will
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  Speaker 4: be implications for New Zealand, and it's something that we're
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  Speaker 4: really focused on.
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  Speaker 2: I noticed last month in an interview at the Economic
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  Speaker 2: Club of Chicago, Trump said, and I quote to me,
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  Speaker 2: the most beautiful word in the dictionary is tariff. It
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  Speaker 2: needs a public relations FIM.
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  Speaker 5: We're going to.
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  Speaker 3: Bring the companies back. We're going to lower taxes so
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  Speaker 3: further for companies that are going to make their product
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  Speaker 3: in the USA, we're going to protect those companies with
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  Speaker 3: strong tariffs. To me, the most beautiful word in the
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  Speaker 3: dictionary is tariff, and it's my favorite word.
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  Speaker 2: What did you make of that statement.
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  Speaker 4: Well, I think New Zealand's trade policies has starts from
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  Speaker 4: quite a different angle. New Zealand has spent many years
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  Speaker 4: trying to remove tariffs. So that's his perspective, and that's
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  Speaker 4: a perspective that he's bringing. We have a different view,
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  Speaker 4: and we will certainly be reminding him of the value
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  Speaker 4: that New Zealand exports add to the United States market.
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  Speaker 2: Is there any possibility that New Zealand, given our notoriously
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  Speaker 2: good relationship with the US, could become exempt of a
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  Speaker 2: sweep of tariffs.
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  Speaker 4: Well, we just don't know. We just don't know, and
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  Speaker 4: it's probably not useful to speculate. I mean, we're in
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  Speaker 4: the same boat as all of the United States trading partners.
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  Speaker 4: You know, this is something that's going to affect everybody,
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  Speaker 4: and it's going to be top of mind for all
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  Speaker 4: the countries that partner with the United States. So I'm
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  Speaker 4: sure that New Zealand companies are thinking about what that
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  Speaker 4: possible impacts could be, But none of us can make
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  Speaker 4: an informed judgment about that until we see the detail.
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  Speaker 1: Thanks for joining us for the owner. New Zealand has
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  Speaker 1: some of.
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  Speaker 2: The best beef and lamb in the world, and it's
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  Speaker 2: not just us saying that the US is our biggest
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  Speaker 2: customer of beef products, bringing in one point seven billion
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  Speaker 2: dollars in the year to May. Beef and lamb and
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  Speaker 2: Z chair Kate Ackland is with us to discuss what
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  Speaker 2: tariffs could mean for this industry. So, Kate, first off,
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  Speaker 2: what was your initial reaction to the US election result?
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  Speaker 5: Well, Lewis, you know, it's a really important market for US.
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  Speaker 5: It's the largest market for beef and for lamb, so
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  Speaker 5: of course we were watching the results pretty closely.
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  Speaker 2: On the campaign trial I noticed Donald Trump promised either
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  Speaker 2: a ten or twenty percent tariff on all US imports,
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  Speaker 2: as well as a sixty percent levy on Chinese made products. Now,
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  Speaker 2: can you explain to us what that actually means?
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  Speaker 5: Well, you know, the president that made a lot of
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  Speaker 5: comments during campaign travel what that actually means in practice?
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  Speaker 5: That comes twenty to January when he's inaugurated. That remains fifteen.
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  Speaker 5: What we do know is that we've got really strong
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  Speaker 5: relationships with the US both across the sector but also
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  Speaker 5: with customers. And there's a really strong demand shrubber because
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  Speaker 5: our products are quite complimentary rather than a substitute for
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  Speaker 5: American beef and lamb. So these sects will stand up
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  Speaker 5: in really good stead going forward. But you know, essentially
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  Speaker 5: it's a wait and see.
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  Speaker 2: Yeah, I know, economists worldwide have warned that these tariff
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  Speaker 2: plans could push the US import duty rates back up
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  Speaker 2: to nineteen thirty's era levels. What does that mean?
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  Speaker 5: I think essentially New Zealand no extra confliments. You know,
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  Speaker 5: the lean beef that goes into things like McDonald's Bergers
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  Speaker 5: for example, actually complements the US production. So you know,
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  Speaker 5: any measures against New Zealand farmers will potentially impact US
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  Speaker 5: farmers as well. So now as I say that, it's
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  Speaker 5: very much a latency approach. Beef and lamb is a
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  Speaker 5: US or Washington, DC based trade relationship manager, so you
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  Speaker 5: go through him. We're able to keep a really close
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  Speaker 5: eye on those issues as they arise.
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  Speaker 2: Right, So he's going to be pretty busy over the
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  Speaker 2: next few months and of course next year as well.
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  Speaker 5: Hey, yes he is, So you know we're keeping a
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  Speaker 5: really close eye through the US Trade and Relationship Manager,
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  Speaker 5: but also really close contact with New Zealand government officials
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  Speaker 5: over the next few months, just as we try and
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  Speaker 5: see some certainty.
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  Speaker 2: So the figures from STATS and Z show that in
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  Speaker 2: May a rise in exports was led by an increase
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  Speaker 2: in exports to the United States. It reached a billion
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  Speaker 2: dollars for the first time. Now the US is our
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  Speaker 2: second biggest export market, with an annual value of eight
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  Speaker 2: point eight billion for the year ending May twenty twenty four,
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  Speaker 2: behind only China seventeen point nine billion. In the year
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  Speaker 2: end of June, I noticed that NZ exported nearly two
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  Speaker 2: point five billion dollars of meat and edible offal to
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  Speaker 2: the US, which included nearly one point six billion alone
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  Speaker 2: of frozen beef. What could these kinds of tariffs anywhere
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  Speaker 2: from ten to twenty percent. What would that mean for
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  Speaker 2: New Zealand exports and especially New Zealand beef.
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  Speaker 5: Well, there's no doubt that the US is actually our
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  Speaker 5: largest market for red meat, for both beef and man.
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  Speaker 5: It's a really important market. Eighty five percent of what
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  Speaker 5: we export to the US is lean meat, and that's
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  Speaker 5: next the fatter US product ground beach so it's really
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  Speaker 5: key ingredients in Hamburger. So there's really strong demand currently
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  Speaker 5: in New Zealand. It's got preferential access into the US
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  Speaker 5: through our WTY of country specific terraf front quota, and
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  Speaker 5: that makes us really competitive in the market in terms
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  Speaker 5: of what measures could be taken. As I said, it's
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  Speaker 5: worth fighting to see. We're keeping it really close on it,
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  Speaker 5: but I think it's too early to speculate.
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  Speaker 6: We have got to wait till the twentieth of January
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  Speaker 6: next year. Also, we have a very very strong case
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  Speaker 6: to make ourselves an exception because of the thinness of
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  Speaker 6: our market, the fact that we pay first world waged
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  Speaker 6: when first world conditions, and so we're not an exploit
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  Speaker 6: out of the country that you could bring those sorts
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  Speaker 6: of tariffs against without having evidence. And so in our
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  Speaker 6: case we're not overly confident, but we've got ourselves ready.
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  Speaker 2: In terms of what a tariff is, it's kind of
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  Speaker 2: like a levey or a duty fee to be able
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  Speaker 2: to export our meat or produce into the US. Have
• 10:27
  Speaker 2: I got that right, Yes, you do so.
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  Speaker 5: Under our WCO quoture, we currently pay a lower tariff
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  Speaker 5: than a lot of other countries. So we are export
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  Speaker 5: currently to attract ter it's just where that might go
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  Speaker 5: in the future. We do it not and so it's
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  Speaker 5: very much even as relationships strong.
• 10:43
  Speaker 2: How devastating could a tariff like that be on our
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  Speaker 2: beef industry or would you just need to change tax
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  Speaker 2: and focus on another country and build that relationship up.
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  Speaker 5: Look, I mean New Zealand ridmate seats that we export
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  Speaker 5: to one hundred markets around the world, and you know,
• 10:56
  Speaker 5: political dynamics change in those markets all the time. So
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  Speaker 5: we're really well experienced in dealing with the ambigulity and
• 11:02
  Speaker 5: building strong relationships. But the advantage we have is we
• 11:05
  Speaker 5: have really strong relationships in the US already is really
• 11:09
  Speaker 5: strong demand for our product, so it's just going to
• 11:12
  Speaker 5: be over the coming month just building on those relationships.
• 11:16
  Speaker 2: Are there any other markets in the world that you
• 11:18
  Speaker 2: would want a stronger relationship with?
• 11:20
  Speaker 5: Well, Novelle has a great advantage in how well diversified
• 11:23
  Speaker 5: our trade is. The US, says I said, is currently
• 11:26
  Speaker 5: our biggest market. China is another big market, but various
• 11:29
  Speaker 5: or successive governments have done a really great job of
• 11:31
  Speaker 5: nego sharing some good trade guild So we've just seen
• 11:34
  Speaker 5: the GCC come through in the last week. It's not
• 11:37
  Speaker 5: a huge market for us, but it's a really good, strong,
• 11:40
  Speaker 5: growing mark, so market diverisfication strategy as a company I
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  Speaker 5: think fits us really well.
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  Speaker 2: Yeah, and we've got to have some of the best
• 11:47
  Speaker 2: beef in the world here.
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  Speaker 5: Hey, we absolutely have some of the best beef in
• 11:50
  Speaker 5: the world and that growing recognition for grass fed beef
• 11:54
  Speaker 5: is something that we're really pushing and trying to capitalize on.
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  Speaker 2: Thanks for joining us, Kate. That's it for this episode
• 12:06
  Speaker 2: of The Front Page. You can read more about today's
• 12:08
  Speaker 2: stories and extensive news coverage at enzherld dot co dot nz.
• 12:14
  Speaker 2: The Front Page is produced by Ethan Siles with sound
• 12:17
  Speaker 2: engineer Patti Fox. I'm Chelsea Daniels. Subscribe to The Front
• 12:21
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• 12:25
  Speaker 2: tune in on Monday for another look behind the headlines.