Little NZ and the next globalisation

It’s a global week: climate change talks in Cancun, Trans-Pacific Partnership (TPP) talks in Auckland. Tim Groser and New Zealand loom large in both.

Climate change action is the right globalisation for the Greens and Labour but the wrong sort for ACT and large portions of the National party. Free trade in nine or 10 countries bordering the Pacific is the right globalisation for National, most of Labour and ACT but the wrong sort for the Greens and some in the Maori party.

The task at Cancun is to underpin the tenuous recovery of the “Bali road map” from the ditch into which grandiosity drove it at Copenhagen last December.

So the focus is on the minutiae of what countries say they will do to lower — or in faster-developing countries, to slow the rate of growth of — greenhouse gas emissions, on funding less developed countries’ mitigation and adaptation and on ways to measure actions taken, rigorously report them and verify them.

This is the sort of mind-boggling complexity veteran multilateral and bilateral trade negotiator Groser revels in: a document hundreds of pages long peppered with thousands of “square brackets” containing countries’ amendments and wishlists. Groser is chairing these aspects of the Cancun talks.

Little New Zealand’s Cancun profile doesn’t end there. Adrian Macey, climate change ambassador until June and a “square bracket” expert, co-chairs the Kyoto Protocol negotiating stream and is facilitating the sessions on land-use change rules — where there was progress at Copenhagen and which is important for agriculture and forestry and so is big for this country — and emissions markets.

That’s quite a presence for a country of 4.38 million — even if sceptics see no chance of a real agreement before 2013 and probably even 2020. But the sceptics overlook the eventual policy implications of initiatives by big multinational food processors and retailers to brand themselves as climate-friendly and/or environment-friendly. And China’s new five-year plan and India’s Environment Minister Jairam Ramesh have recognised that they will not get as rich as the United States if they make the same demands on resources and the environment on their way up than the United States did.

Next, TPP: Groser and, recently, John Key who insiders say is adding a growing grasp of international relations to his trademark companionability, have played a bigger role getting the TPP moving than our little $190 billion economy warrants. The initiative for the approach taken in the P4 grouping (Brunei, Chile, Singapore, New Zealand) — insistence on high-quality behind-the-border regulatory rules on top of open borders — originated from Groser, starting with Singapore in 1999.

Getting similar high quality in a TPP will be “brutally hard”, a negotiator says. Nevertheless, the government says there is cause for optimism about the momentum, if not yet about substance.

Ministers read much into Japan Prime Minister Naoto Kan’s statement at APEC last month that Japan must now seriously explore free trade options after decades of agricultural protectionism and economic and social nationalism and United States President Barack Obama’s target of a TPP signing at the 2011 APEC summit he is to chair in Honolulu next November.

At APEC the TPP was seen as the only current candidate for the tariff-free Asia-Pacific prefigured in 1994. It also fits Obama’s re-engagement with Asia.

American lawyer Lori Wallach, in anti-free-trade Jane Kelsey’s latest book, No Ordinary Deal and at a Greens conference on November 12, detailed a list of intrusions into our law the United States would impose through a TPP. But the United States is unlikely to be in a position to impose much.

That is in part because of its fractured and fractious national politics, which has de-mandated Obama and of which the populist element reflects a deeper current: a disruptive economic adjustment in which over time a widening range of its wages will have a decreasing margin over those in countries once scorned as “third world”.

This is the 2010s phase of globalisation: inequalities within economies merging with inequalities between economies. It is pride-pricking for the most powerful nation to learn that no really big deals — climate change, global trade — will swing unless it and China can agree at least the basics and even more galling if living standards of much of the American population stall while China’s and India’s rise.

The consequential risk for global cooperation is that the United States stands apart. The ascendant Republicans think there is no climate change. Where they now stand on trade is unclear.

So climate change action and TPP might ultimately be driven from the bottom up, the first stemming from self-interested actions by governments and corporations and the second assembled by incremental additions to the P4.

It’s the sort of action in which Groser thrives and a small, non-threatening country can be useful. As we see this week.