PM English feeling good about NZ-US-Aus relations; Trade talks set to come after NAFTA sorted; talks China with Trump

By Alex Tarrant

Further discussion between New Zealand and the US on a closer trade relationship will likely wait until the US sorts out its position on the North American Free Trade Agreement, Prime Minister Bill English says.

The Prime Minister said he feels good about NZ-US relations, and had never felt concerned, following a 15-minute phone conversation with US President Donald Trump over the weekend. English added he expects Australia-US relations will not deteriorate following reports of a heated phone call between Trump and Australian Prime Minister Malcolm Turnbull.  

English on Waitangi day spoke to Trump on a range of issues, with the discussion touching on the NZ economy, trade and China. Speaking to media in Parliament Tuesday morning, English said Trump was “friendly and open” while communicating “pretty directly”.

Trump’s decision to walk away for the Trans Pacific Partnership free trade deal is a set-back for trade, but not the NZ-US relationship, English said. “We will just work round the decisions that they’ve made. As a small country we’re used to that.”

The two national leaders did not go into any detail of a possible bilateral free trade agreement, he said. Trade Minister Todd McClay has visited the US since Trump entered the White House to discuss the potential for a bilateral agreement.

“Their declared position is that they’re interested in trade agreements of significant benefit to the US,” English said. “It might be hard for us to meet all the criteria that they lay down and get an agreement that suits New Zealand.”

“But I think we’re yet to see how the US trade policy actually unfolds,” English said. “They’ve pulled out of TPP; they’re heading into the probably bigger challenge of working out what they want out of the North American Free Trade Agreement. When they’ve worked through that, there might be further discussion [with NZ],” he said.

New Zealand will work to keep the US engaged in the Asia-Pacific region due to its stabilising influence, English said. The phone call included a “general discussion” on China, he said. Asked specifically if they talked about the South China Sea situation, English declined to give further details.

However, English did tell media Tuesday morning that the New Zealand government has “always said that in the South China Sea we want everyone involved to essentially follow the international rules. That’s been our position – we’ve stated it any time that’s been necessary”.

“Clearly the US has a different relationship with China and they’ll proceed with their policy,” English said. “We just want them to follow the international rules. There’s been a ruling from an international court - we would want to see that followed.”

Trump asked after New Zealand’s economy, expressing an awareness that “we’re doing pretty well,” English said. There is something of an idealist vision of New Zealand in the US, English said. “It’s backed up by, certainly substance on economic growth, which is steady, political stability and they tend to see us as a bit of a haven from all the pressures that they’re dealing with.”

The NZ-US relationship is in “pretty good shape,” having improved significantly over the last 10-15 years, English said. “My intention would be, regardless of political debate about what the US policy is on anything, we want a sound relationship.”

Likewise, the US-Australia relationship looks unlikely to deteriorate, he said. “It’s just too important a relationship. We certainly want to see it succeed because Australia’s one of the larger economies in this part of the world and they’ve always had a close relationship with the US – in a sense closer than ours,” English said.

“I’m pretty optimistic that for New Zealand and Australia, we’ll have good relationships with the US under the Trump administration.”