[asia-apec 1558] Coalition split on Singapore FTA

[APEC Monitoring Group]

The Dominion, Wellington
TUESDAY, 12 SEPTEMBER 2000

      T O P   S T O R Y

Helen Clark
Jenny Shipley
 Leaders' duel may sink trade deal
12 SEPTEMBER 2000

By NICK VENTER
A contest of wills between Prime Minister Helen Clark and her predecessor
Jenny Shipley is threatening a free trade agreement with Singapore.
Negotiations over the groundbreaking deal began when Mrs Shipley was prime
minister and concluded under Miss Clark.

But the deal might not come into effect because neither leader appears
willing to give ground over a controversial clause in the agreement.

On Monday, Miss Clark accused Mrs Shipley of "playing the race card". Mrs
Shipley accused her of "arrogance".

The clause at issue asserts the Government's right to give more favourable
treatment to Maoris to "close the gaps".

According to Miss Clark, it is similar to a clause included in the proposed
Multilateral Agreement on Trade by the previous National-led government.

But Mrs Shipley says the clause goes beyond anything contemplated by
National and paves the way for deals such as the reservation of high
frequency radio spectrums for Maoris.

She said Miss Clark should use the Government's executive powers to sign the
agreement.

If she persisted in putting the agreement before Parliament it was "very
unlikely" National MPs would vote for it in its present form. "We will not
be hostage to her inability to manage her Coalition," she said.

National holds the whip hand on the legislation because the Alliance chose
to invoke for the first time the "agree to disagree" clause in its Coalition
agreement with Labour.

Its decision leaves Labour 12 votes short of the numbers it needs to get the
bill ratified by Parliament. But Miss Clark said she would not push through
an agreement that did not have parliamentary support.

"It's up to them (National). If they want to make fools of themselves and
New Zealand, go ahead. If the National Party is not prepared to support it,
the agreement will not proceed."

Mrs Shipley is also angry that National was not consulted about the
agreement before it was initialled off by New Zealand and Singaporean
representatives.

National's trade spokesman, John Luxton, was given a copy of the agreement
in confidence about a week ago, but there was no consultation about the
content, Mrs Shipley said.

It was "arrogant" of Miss Clark to presume National would support the deal
under those circumstances.

Miss Clark said it was "contemptible" of National to play short-term
politics with the agreement, but she was relaxed about the outcome.

"There's no mud on our face. We carried on work they had already begun. If
they want to scab on her arrangement with the Singaporean prime minister,
let her go and explain that to him.

"Why she is playing the race card on it will be a mystery to anyone who is
involved in trade."

Alliance leader Jim Anderton said his party would vote against the agreement
because it did not include minimum employment and environmental standards,
and because it reduced New Zealand's control over its own affairs.

If the agreement is ratified, remaining tariffs will be removed on goods
traded between the two countries, providing an immediate boost for New
Zealand brewers.

It will also make it easier for New Zealand suppliers of telecommunications,
health, architecture and engineering service suppliers to do business in
Singapore.

However, the biggest impact is likely to be in precedent-setting. Trade
Negotiations Minister Jim Sutton said it was being keenly watched and would
make negotiation of economic partnerships throughout the Apec (Asia-Pacific
Economic Cooperation) regime more credible.