The farmers there came from the developing world right through to the economic elite of the G8. New Zealand may be small in population, but we are an agricultural super power. And there I became the Oceania board representative on the WFO; it is amazing to be engaged in farmer-to-farmer diplomacy.
Every second, at least two more humans are born into the world than leave it so the world needs its farmers. Feeding the globe is a huge opportunity to take our farming skills, knowledge and abilities out into the world, something some of our exporters are doing. Yet farmers are also critical to the wise management of the world’s precious land and water resources. It is not smooth sailing because one of the biggest problems farmers face revolves around trade barriers and subsidies.
Earlier this year, Beef+Lamb NZ put the cost of tariffs on New Zealand’s red meat exports at an amazing $19,000 for each farm. Extend that to our other primary exports and you get an idea of what tariffs are costing not just us, but all New Zealanders. Imagine what effect this has upon developing economies.
Federated Farmers is convinced trade barriers have to go if we are to create a level playing field. It is not just an economic imperative but a moral one.
Through agreements like the TPP (Trans Pacific Partnership), New Zealand will be negotiating trade barriers away. For developing economies, tariffs and subsidies are an insidious poverty trap.
Doing something about these barriers and blockages to trade is what the WFO general assembly has committed itself to. The WFO has agreed a landmark trade policy.
At least 50 farming bodies are committed to the parallel elimination of export subsidies combined with discipline on all export measures which have similar effects. Strengthened rules like this should apply to export prohibition/restriction and taxes on exports too.
It is simply unprecedented for farmer organisations to work together to reduce trade-distorting domestic support. Yet this does not mean unfettered trade as the policy allows for special and differential treatment for developing and the least developed countries.
Getting 50 countries to agree to anything is a challenge and you do not get perfect outcomes. We had to compromise on geographical indications and country-of-origin requirements, but what we got in return was their use to distinguish rather than become, potentially, non-tariff trade barriers. We also saw strong support for the World Trade Organisation concluding multilateral trade negotiations like Doha. Yet, WTO compatible bilateral and regional trade agreements, like the TPP, also work.
Maybe the New Zealand story, in which farming has gone from sunset to sunrise, provides inspiration.
Until it joined the European Union (EU) in 1973, Britain was our alpha and omega. We grew meat and fibre and sent it north along with 90% of our butter and 75% of our cheese. In return, we got British Leyland vehicles of dubious quality; but that changed when Britain entered the EU.
Our economy and outlook has reoriented towards Europe, the United States and Asia. Putting one or two interventionist hiccups to one side, we eventually followed in the late Margaret Thatcher’s economic footsteps.
Meeting farmers in Japan is significant in another regard. Japan is New Zealand’s fourth-largest trading partner and recently announced its intention to join negotiations on the TPP. While we are a net food exporter Japan is the world’s largest net food importer. Our two economies have a natural synergy and 20 years ago our two-way trade was about ten times greater than our then two-way trade with China. Today, that trade is about half of our trade with China.
Part of that change reflects China’s impressive economic growth but it is really an advertisement for trade access and openness. Since 2008, when we signed the New Zealand-China Free Trade Agreement, New Zealand’s exports to that country have trebled.
Trade helps to even out demand and supply while helping to meet the world’s ever-increasing need for food. Providing farmers everywhere with increased market opportunities helps to improve incomes, prosperity and economic growth. That benefits not only rural communities but all communities
• Bruce Wills is the President of Federated Farmers and is the Oceania Board member for the World Farmers Organisation (WFO).
