Cause this is a shock today – isn't it? To find out that we’ve just been bumped up to 15% while Australia and dozens of other countries have stayed on 10%.
Now, it seems to be related, most likely, to our balance of trade and that the US has a trade deficit with us. So we get 15%, but then a trade surplus with Australia, so they get 10%. So perhaps it was inevitable and unavoidable, as long as the balance of trade sat like that.
But then, on the other hand, Australia did kind of lock that in as well. They lifted their ban on US beef imports while we did nothing. Should we have done something similar. Because if there's one thing that we know about Donald Trump, it's that he's a trader.
South Korea had their tariff dropped from 25% to 15% by promising to buy $100 million worth of LNG. Sir Keir Starmer sucked up to Trump with a letter from King Charles.
Now we don’t actually know what our diplomats were doing, because they were fairly guarded about it. But the vibe that we kept getting from ministers and officials every time we asked about it was, ‘not a lot going on, we’ll see how this goes, we’re on 10%, we’re no worse than anyone else’
That’s the trouble, though. We are now worse than other people. We export beef to the US, Australia exports beef to the US. Their beef now gets 10%, ours gets 15%.
Now, we can argue about whether US consumers are really going to switch up their $11.50 New Zealand steak if the Aussie steak is only 50 cents cheaper. I mean, what's really the difference between $11.50 and $11? But I chose a butter last night because it was $1 cheaper than the other butter, so maybe they will, which brings me to the question that I asked at the start of this.
Were we too relaxed?
Because we definitely and quite deliberately opted for Winston's head below the parapet approach. But maybe what we should have done was opted for the same approach that Albanese and Starmer took, which is to suck up instead. Given where we are and where they are - both their countries are now on 10% and we're sitting on 15%.
Heather du Plessis-Allan is a journalist and commentator who hosts Newstalk ZB's Drive show HERE - where this article was sourced.
9 comments:
Too early to tell.
The last thing to do is mimic Starmer and Albanese.
And maybe the childish comments about Trump by a recent PM didn't help either
Todd stuffed up.
Labour and the msm are going on that the government could have done more but have not mentioned anything specific that should have been done. Australia and the UK are linked to the US through AUKUS. The old ANZUS is virtually non existent. Why is that? Because all the left wing anti-American, anti-nuclear peacenik policies favoured by successive governments since Lange's time. You cannot have it both ways.
Instead of knee-jerk hand ringing, perhaps du Plessis-Allen should behave like the journalist she claims to be and report a little deeper. For example, why doesn't she tell us:
1, What level of tariff did the US impose on our exports pre-Trump?
2. How do the new tariffs compare with the status-quo?
3. What proportion of our exports went to the US pre-Trump?
4. Who else amongst our trading partners would pick up any fall-off in sales to the US
5. In short, what is likely to change under the new order and why should we care?
Isn't that what journalists are supposed to do?
How about we get real? What make us think that our economy features on Trump’s radar? The guy is a trader - what deal can we offer?
"The guy is a trader". But surely his tariff policy, as erratic as it is, is the definition of the frustration of trade. It is aimed at protecting American industry by penalizing competition. It's actually more than that; it is in many cases about Trump imposing his will on the internal politics of another country. With merely the stroke of a pen - or actually a dozen strokes with a sharpie - he can effectively blackmail a country it do his bidding. Should we have sucked up to him to get a better deal, like Australia has got? I think not, but make our case for freedom of trade, as we have done in recent decades.
History will judge Trump on this matter, like much else. I suspect it won't be favorable.
One point I never see made is that the tariffs are on the import price of the item, not the retail price in the shop. I would doubt that transport + retail mark up + tax adds anything less tan 100% to the landed price, which means that an extra 5% tariff will add at most 2.5% to the shop price.
Personally I get much more comfort in knowing that the FBI has opened a bureau in NZ than worrying about US tariffs . Remember the USA is a pacific rim country and so is NZ.
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