Korea FTA worth million$

March 24, 2015

The signing of the Free Trade deal with Korea, singed by Trade Minister Tim Groser yesterday  has the potential to add millions of dollars in extra export earnings.

“Improving access to international markets through free trade agreements is a key component of the Government’s Business Growth Agenda. Supporting our exporters is crucial to creating new jobs and boosting incomes for New Zealanders,” says Mr Groser.

“This Agreement secures the long-term future of New Zealand exporters to Korea whose international competitors were benefiting from Korea’s other FTAs.

“It reduces barriers to trade and investment, provides greater certainty about the business environment and ensures our exporters remain competitive in each other’s market.”

On entry-into-force, tariffs on 48.3 percent or NZ$793.7 million of New Zealand’s current exports to Korea will be eliminated. The Agreement will progressively remove tariffs on 98 per cent of New Zealand’s exports to Korea.

“Particular success stories include the removal of wine tariffs of 15 percent on entry into force, and the removal of 45 percent tariffs on kiwifruit effectively five years after entry into force,” says Mr Groser.

“It will also make possible a new level of cooperation in areas like agriculture, the creative economy, the environment and education, and spur greater investment.”

The FTA will offer improved protections for New Zealand investors in the Korean market, and reinforce the attractiveness of New Zealand as a stable investment destination.

Prime Minister John Key and President Park Geun-hye of Korea witnessed the signing of the Agreement by Trade Ministers Tim Groser and Yoon Sang-jick in Seoul.

“The Agreement shows the strength of the relationship between New Zealand and Korea. It symbolises our countries’ commitment to economic openness and market integration in the Asia-Pacific region,” says Mr Key.

“Korea is one of New Zealand’s biggest and most important trading partners. This Agreement makes it easier for Koreans and Kiwis to do business with each other, and the removal of tariffs will benefit consumers in both countries.

“At the moment, New Zealand exports into Korea attract NZ$229 million a year in duties.  Tariff reductions in the first year of the FTA alone will save an estimated NZ$65 million.”

The Agreement now needs to be ratified by the New Zealand Parliament.

“We are keen for the Agreement to come into force this year,” says Mr Key.

“With a population of over 50 million and as the 13th largest economy in the world, Korea is an attractive market for New Zealand exporters.” . . .

Korea is New Zealand’s sixth largest export destination for goods and services and our eighth largest import source, with total two-way goods trade of NZ$4 billion.

Once ratified by parliament, the FTA will open the door to better business for Koreans and New Zealanders.

It makes the eggs in other trading baskets than China more valuable, will give better returns for our exporters and more choice and lower prices for consumers in both countries.


Rural round-up

March 6, 2015

World dairy prices and New Zealand droughts - Jim Rose:

Here is an image from the recent Westpac Economic Overview. As New Zealand is the world’s largest exporter of dairy products any disruption in the supply from New Zealand can impact on the global dairy prices.

The last few droughts saw world dairy prices increase considerably as milk supply from the rest of the world was unable to adjust to market conditions.

However supply capacity in the US and the EU has increased and with Russia’s import ban there is a much greater supply on the global market. Nevertheless, this doesn’t disprove the possibility that prices rise when supply falls short. The overall signs are that supply and demand are coming into line as Chinese buyers run down stocks.

The drought in New Zealand will further boost prices from current low levels. Westpac expect the milk price to rise to $6.40/kg for the next season. Below is a useful video…

ANZCO’s profit disclosed in Itoham’s statement – Allan Barber:

Japanese food company Itoham Foods announced last week an increase in its shareholding in New Zealand meat processor and exporter ANZCO Foods from 48.28% to 65%. As a result of the transaction it will be able to consolidate ANZCO’s revenues and earnings into its annual accounts.

 $40 million worth of shares are being bought from three entities: another leading Japanese food manufacturer Nippon Suisan Kaisha, chairman Graeme Harrison, and JANZ Investments, owned by Graeme Harrison and ANZCO staff members. The sale will see the minority shareholders reducing their shareholdings on a pro rata basis with Harrison’s effective holding falling from approximately 20% to 14%. . .

BOP Dairy Awards Boosts Careers:

Entering the Bay of Plenty Dairy Industry Awards has helped the region’s 2015 Sharemilker/Equity Farmers of the Year, Grant and Karley Thomson, secure a new position beginning in June.

The couple were the major winners at the 2015 Bay of Plenty Dairy Industry Awards held at the Awakeri Events Centre in Whakatane last night. The other big winners were Jodie Mexted, the Bay of Plenty Farm Manager of the Year, and Jeff White, the region’s Dairy Trainee of the Year.

The Thomsons, who won $10,100 in prizes, are currently 50% sharemilking (with a silent partner) 420 cows for Tom and Tony Trafford at Opotiki. . .

 

New Zealand King Salmon Success to Feature at Queenstown Agribusiness Symposium:

Aquaculture business, New Zealand King Salmon, will feature as one of the success stories at the second Queenstown Agribusiness Symposium this month.

New Zealand King Salmon successfully launched Ōra King premium salmon in 2012 to the international foodservice market.

The farmed salmon is now on fine dining menus around the globe.

The Queenstown Agribusiness Symposium attracts senior staff, managers and leaders from throughout Asia Pacific horticulture, agriculture, seafood and biotech industries to help them develop new ways to problem solve and grow their business. . .

Prime Minister John Key Visits Manuka Health’s New State of the Art Honey Facility:

New Zealand Prime Minister, John Key, has been given a tour of Manuka Health’s brand new multi-million dollar, purpose-built honey processing and distribution centre on a recent visit to Te Awamutu in the Waikato.

Mr Key was shown through the premises by Manuka Health CEO and founder, Kerry Paul. It is now the largest customised honey facility in New Zealand and combines internationally accredited laboratories, honey-drum storage, blending, packing and distribution under one roof.

Mr Paul, says it was a huge honour to have the Rt Hon John Key visit the new centre. . .

Tasman Young Farmers to be put to the test in ANZ Young Farmer Contest Regional Final:

The third ANZ Young Farmer Contest Grand Finalist will be determined next weekend, Saturday 14 March at the Tasman Regional Final held in Kirwee.

“This contest season is shaping up to be very exciting, every year the calibre of contestants continues to improve and impress,” says Terry Copeland, Chief Executive of New Zealand Young Farmers – organisers of the event.

The eight finalists are contending for a spot at the Grand Final in Taupo 2 – 4 July and their share of an impressive prize pack worth over $271,000 in products, services and scholarships from ANZ, FMG, Lincoln University, Silver Fern Farms, AGMARDT, Ravensdown, Honda, Husqvarna and Vodafone. . .

 


Taking keys turning into vigilantism

March 4, 2015

Would you take the keys from a driver you considered dangerous?

I’ve phoned *555 a couple of times.

Once was to report a driver on his way home from a hunt with hounds in the back of his ute who kept driving on the wrong side of the road.

The second time was on the Crown Range. The driver had sped past us and three other vehicles when we’d stopped at road works and didn’t appear to know which side of the road he was supposed to be on, veering right at every corner.

Phoning police was a reasonable response but I don’t think trying to take the drivers’ keys would have been, even if there had been an opportunity to, which there wasn’t.

But if there is no phone reception or the police too far away to help,in time, would taking keys be acceptable?

On rare occasions and as a very last resort, perhaps.

But definitely not as a matter of course and absolutely not with violence as happened on the West Coast.

There’s a very fine line between preventing an accident and vigilantism which could, as Prime Minister John Key says, lead to a terrible incident.

 


MPs’ pay rise pared back

March 3, 2015

Prime Minister John Key has announced an overhaul of the Remuneration Authority Act, tying MP salaries to those of the wider public sector, which will be passed under urgency.

Mr Key says the decision was made after the Remuneration Authority’s latest determination which saw the total remuneration received by MPs increased by about 3.5 per cent.

“That increase was neither necessary nor justified at a time when inflation is at 0.8 per cent,” says Mr Key.

“While the decision was made independently of MPs, they should not be receiving increases which are disproportionate to the wider public sector.”

Mr Key says the Remuneration Authority referred specifically to the criteria contained in the Remuneration Authority Act 1977 as the reason for the increases, therefore a law change was necessary.

The change will take away the Authority’s discretion when setting MP pay. The sole criteria will now be the average public sector pay increase for the previous year.

Mr Key says the decision to remove the Authority’s discretion was not taken lightly, given that it changed a practice going back several decades.

“However, it is clear that changing the criteria upon which that rate is set is the only way to ensure the Authority will start handing down more modest pay increases.”

The new legislation will be backdated to 1 July 2014, meaning the pay increase outlined in the latest determination will not be awarded.

Based on the most recent data, total remuneration will instead increase by something in the range of 1 – 2 per cent, reflecting average wage growth in the public sector.

Ministers anticipate more detailed advice from officials on the measure to be used, which will be set out in the legislation, likely to be introduced in the next sitting session.

There is always an uproar when MPs’ pay rises are announced but feelings were stronger about last week’s announcement when inflation is so low.

Continuing to say it was out of their hands was an untenable position for MPs when they had the power to change the legislation.

Acting to reduce the current pay rise is a good move but it would be better if changes to the legislation weren’t  done under urgency to allow public submissions.

 


MPs can change Act

February 27, 2015

One man I approached to see if he’d be interested in seeking selection as a candidate for National last year said he couldn’t afford to.

He was at a stage in his life where the drop in pay would be too big a hit for him and his family .

That could well be the reason some people don’t stand but many who do enter parliament get a pay rise and few leave to go on to higher paying careers.

That is one of the reasons the news of MPs’ pay rises are met with such outrage although pay should be for what they are actually doing rather than what they did before, or might do after they leave, parliament.

On that basis some are underpaid.

My MP Jacqui Dean, for example serves and services well the country’s third largest general electorate, Waitaki. She is a select committee chair (for which she is paid a little more) and a parliamentary private secretary (which attracts no extra pay) and she’s also co-chair of the Rules Reduction Taskforce.

There is no question that she works hard and substantial increased majorities in successive elections indicate her constituents recognise this.

That can’t be said for all MPs.

Can anyone name more than one or two of the sycophants who are in parliament on New Zealand First’s list let alone provide evidence they do much to earn their salary?

Remuneration Authority members aren’t tasked with what individual MPs do. Salaries are set not on individual performance but the positions they hold so a hard working and effective MP gets the same as a slacker.

In announcing increased pay rates for MPs the Authority said:

The Authority continues to use a total remuneration approach in setting the base salary for members, as it does for other groups for whom it sets pay. The Authority takes as its starting point its payline for public servants undertaking jobs with broadly similar complexity and responsibility. That enables it to identify a total remuneration package, based on market rates, for ordinary members. The Authority then deducts from that total package the value of the employer superannuation subsidy to members (20% of an ordinary member’s salary) and the personal benefit of entitlements to members and their families (as assessed by the Authority). The figure remaining after these deductions from the total package becomes the base salary. If an individual member chooses not to take advantage of one or both of the entitlement and superannuation payments, his or her base salary is not increased.

1.5 The same approach is not taken with senior positions in Parliament, including the Prime Minister, Ministers, the Speaker, the Leader of the Opposition, Party Leaders, and so on.

1.6 In recognition of the significant element of public service given by those serving in the Executive and in senior roles in Parliament, democracies like our own have traditionally significantly discounted the rate at which their leaders have been materially rewarded, and those aspiring to those positions have accepted such a discount. The rates for these positions are not set based on market rates or the Authority’s general payline, but maintain previous relativities established over many years and reinforced when parliamentary remuneration was fully reviewed in 2001/02. . .

In 2014, the Authority’s payline at the level for ordinary members increased by 3.3%. For this year, the personal benefit of the travel entitlement to members and their families has been assessed at $3,200 per member, a reduction in the amount assessed in previous years, which takes into account tightened provisions around the personal use of travel by family members. Taking into account the change in value of the travel entitlement, this produces a package increase of 3.56% and a salary increase for ordinary members of 5.5%. . .

Which market rates the Authority took account of to get a package increase of 3.5%, and a salary increase for ordinary members of 5.5%, which takes into account the decrease in travel allowances, when inflation is so low isn’t clear, especially when the PM wrote requesting no increase at all:

. . . He told reporters this morning that he wrote to the Remuneration Authority early this year urging it not to give MPs a pay rise at all this year, but the authority had given them a pay rise anyway.  . .

He wants the Authority to review its system:

“What I think the Remuneration Authority should do, if they are going to give a pay increase to MPs, is I think they should point to the law and tell us what in the law is driving the sort of increases that they want to give MPs, and then we should go away and consider whether we think that law is appropriately set,” he said.

“In my view it’s quite clear that inflation is low, that MPs are by any measure well recompensed, and against that the Remuneration Authority has had the view that ministers are a long way away from chief executives and to other senior people in the private sector.

“But you don’t go into politics and become either a minister or a prime minister, or even a backbencher, because you are there for the money. If you do you are there for completely the wrong motivation, so I just don’t think that’s a relevant comparison in my view.” . . .

An Act of Parliament governs how MPs’ remuneration is set and therefore it is in MPs’ power to change it.

David Farrar has been suggesting sensible change for some time:

. . .On multiple occasions I have submitted that the law should be changed so that the sets salaries for an entire parliamentary term, rather than annually. There is no need for annual adjustments in a low inflation environment. They should be set three months before each election and apply for the whole term. . .

That wouldn’t change the howls of outrage every time there is a pay increase.

But it would set a good example when inflation is low and provide an incentive for keeping it low.


What would they do in government?

February 25, 2015

Question Time yesterday:

Andrew Little: Is being part of the club worth sending our soldiers to war without the authorisation of Parliament, without a plan, without legal authority, and without any guarantee of their safety?

Rt Hon JOHN KEY: There are 62 members who have decided that they, in some part, will play a role in standing up to evil, in standing up to people who threaten New Zealanders and our values (uncorrected transcript—subject to correction and further editing) and principles. I suspect, actually, it was a very similar number when Helen Clark decided to send the engineers to Iraq. I suspect it is the same situation as when Helen Clark decided to send the SAS in a combat role. As is so often the case, what we see from Labour is that it does one thing in Government and says another thing in Opposition.

Andrew Little: Why does he not support Labour’s position to actually give the Iraqi Government the help that it has asked for—humanitarian support and reconstruction expertise?

Rt Hon JOHN KEY: A number of things—firstly, we are already giving humanitarian support, $14.5 million. Secondly, I would make the point that in our meeting with the Iraqi Foreign Minister the No. 1 thing that he asked for was security training—so the training of Iraqi security forces. I will make this one final point. It is a slightly warped sense of risk when the Leader of the Opposition thinks that the role New Zealand should play should be conducting air strikes when we do not have that capability, as he has publicly said, and, secondly, the reconstruction of roads, schools, and hospitals outside the wire, in an environment where they would be subject to improvised explosive device attacks, attacks by the Islamic State of Iraq and the Levant—

Hon Member: You’re making it up again.

Rt Hon JOHN KEY: Well, you cannot do them behind the wire, sunshine.

During the debate on the issue, the PM summed up:

. . .On Monday the Government made a decision to send New Zealand forces to train Iraqi forces. It made the decision to send 106 people to Taji for up to 2 years.

We made the decision to stand up to the evil and barbaric behaviour we have seen from the Islamic State of Iraq and the Levant .

I want to focus not on political parties that have either well-established positions or fundamentally not much to add to the debate, but I want to focus on Her Majesty’s loyal Opposition .

The interesting thing is this. Labour in New Zealand, when it comes to sending New Zealand forces for training says no—it says no.

But the interesting thing is that the Labour Opposition in the UK says yes. The Labor Opposition in Australia says yes, and the equivalent of the Labour Opposition in Canada says yes. So every Labour Opposition in like-minded countries says yes, but, apparently, the Labour Opposition in New Zealand says no.

But hold on a minute, the Labour Opposition, when it was the Government, said yes to sending 60-odd engineers to Iraq. No debate, no vote—“You’re going, boys.”

And the Labour Opposition, when it was in Government, said yes to the combat forces of the SAS , and it did not tell the country; it just said yes.

I listened to Andrew Little’s speech, and here is the bottom line: he did not believe it, and I do not believe him because he knows that these people are barbaric and evil.

He knows that there are 35 to 40 New Zealanders at risk of a domestic threat. He knows, like I know, that the number of people on the list is growing to 60 or 70.

He knows, like I know, that New Zealanders are in the region. He knows, like I know, that New Zealanders travel prolifically, and he says that he cares about New Zealanders and he says that he wants to stand up for them.

Well, in Government he would be making this decision. You see, the reason he is not is this. It is not that it is not the right thing, because Phil Goff, when he was the Minister of Defence, used to do all this stuff with bells on.

The reason he is doing it is that he wants politics to win over what is right for the people. I will not—will not—stand by while Jordanian pilots are burnt to death, when kids execute soldiers, and when people are out there being beheaded. I am sorry, but this is the time to stand up and be counted. Get some guts and join the right side.

New Zealand is already giving aid but while the humanitarian support and reconstruction assistance Little suggested sounds better than sending troops to train the locals, it would be more dangerous.

A party that looks like a government in waiting has to be very careful to act like one in opposition.

The next Labour government won’t do everything the way the last one did.

But if it was asked to send troops as the last one was, is it would be likely to.

The wee parties can get away with

Instead of looking like he was ready for government, Little’s speech and stance has left him looking like the leader of just another opposition party who is unprepared for the hard decisions the executive has to take.

Hat tip for transcript: Your NZ


NZ troops to train Iraqis

February 24, 2015

Tough decisions are rarely black and white.

The decision to send troops to a war zone, even if it is to train locals rather than engage in combat, is one of the tougher ones a government has to make and the complexities of the Middle East make the issue even more complicated.

The Dominion Post editorialises:

 . . . A political force which prides itself on beheadings and crucifixions of the innocent is intolerable to any democratic state.

The problem is that almost every form of Western intervention is fraught with trouble. The West has learnt from the invasion of Iraq, and the long bloody stalemate in Afghanistan, that making war in the Middle East often makes things worse rather than better.

So the choice is extraordinarily conflicted. Honest opponents of intervention should admit that the decision not to fight is deeply troubling because Isis is evil. Honest proponents of intervention should also admit that the war might have a just purpose but it is also probably unwinnable. . .

The government will have considered all of that in deciding to send troops to train Iraqis and Prime Minister John Key explained the decision in parliament today:

Mr Speaker, today I am announcing to the House the Government’s decisions about our contribution to the fight against the Islamic State of Iraq and the Levant, or ISIL.

Last November I gave a national security speech which outlined the threat posed to New Zealand by ISIL.

This brutal group and its distressing methods deserve the strongest condemnation.

ISIL’s ability to motivate Islamist radicals make it a threat not only to stability in the Middle East, but regionally and locally too.

It is well-funded and highly-skilled at using the internet to recruit.

Disturbingly, if anything, ISIL’s brutality has worsened since I gave that speech late last year.

In recent weeks we have witnessed a mass beheading and the horrific plight of a Jordanian pilot being burned alive in a cage.

And we’ve seen stories of Western hostages who have been kidnapped and killed in barbaric ways.

ISIL’s outrageous actions have united an international coalition of 62 countries against the group.

New Zealand is already considered part of the coalition because we have made humanitarian contributions, with $14.5 million in aid provided to the region so far.

The Government has been carefully considering its options to expand our contribution to the international coalition.

As I outlined in November, our approach is one that addresses humanitarian, diplomatic, intelligence and capacity building issues.

Mr Speaker, New Zealand is a country that stands up for its values.

We stand up for what’s right.

We have an obligation to support stability and the rule of law internationally.

We do not shy away from taking our share of the burden when the international rules-based system is threatened.

We have carved out our own independent foreign policy over decades and we take pride in it.

We do what is in New Zealand’s best interests.

It is in that context that I am announcing that the Government has decided to take further steps to help the fight against ISIL.

The Iraqi government has requested support from the international community and has been clear with us that security is its top priority.

We have been clear that we cannot, and should not, fight Iraqis’ battles for them – and actually Iraq doesn’t want us to.

Our military can, however, play a part in building the capability and capacity of the Iraqi forces so they can fight ISIL themselves.

I have been open with New Zealanders that we have been considering an option to train Iraqi Security Forces alongside our longstanding partner Australia, in Iraq.

Such an operation would be behind the wire and limited to training Iraqi Security Forces in order to counter ISIL and legitimately protect innocent people.

Mr Speaker, the Government has decided to deploy a non-combat training mission to Iraq to contribute to the international fight against ISIL.

This is likely to be a joint training mission with Australia, although it will not be a badged ANZAC force.

Their task will be to train Iraqi Security Force units so they are able to commence combat operations, and eventually able to carry on the work of our trainers – creating an independent, self-sustaining military capability for the Government of Iraq to call on.

The mission will involve the deployment of personnel to the Taji Military Complex north of Baghdad, and this is likely to take place in May.

The deployment will be reviewed after nine months and will be for a maximum two-year period.

The total number of personnel deploying is up to 106 in Taji, and there will be others such as staff officers, deploying in coalition headquarters and support facilities in the region.

The total altogether will be up to 143.

As well as these people, further personnel and Air Force assets will occasionally need to be deployed to the region to support the mission – for example in support of personnel rotations and resupply.

Mr Speaker, a training mission like this is not without danger.

It is not a decision we have taken lightly.

I have required assurances that our men and women will be as safe as they can practicably be in Taji.

Our force protection needs have been assessed by NZDF and determined as being able to be met by the well-trained soldiers of our regular Army.

So we will be sending our own force protection to support the training activities.

I want to briefly address the issue of special forces.

As I said last November, I have ruled out sending SAS or any troops into combat roles in Iraq.

The Chief of Defence Force has advised me that special forces are not part of this deployment.

However, I want to be clear that special forces could be deployed for short periods to provide advice on issues like force protection or to help with high profile visits – as they have many times before.

Our deployment in Taji will include logistics and medical support, as well as headquarters staff.

It is our intention that Iraqi Security Forces be able to assume responsibility for delivering their own training programmes in future.

The New Zealand Government will retain ultimate decision-making authority over the nature and scope of the activities of the NZDF personnel within the mission, and those personnel will deploy with appropriate legal protections.

Exactly what form those legal protections take will be worked through in coming weeks with our Iraqi counterparts.

We will secure the best protections we realistically can for our personnel.

Mr Speaker, our military has a proven track record of carrying out this type of training work in Afghanistan.

This is a contribution that’s in line with our values and our skills.

But this is not all we will do to help.

We recognise ISIL is not a short-term threat and there is a lot of work to be done in the long-term.

Defeating ISIL will mean winning the hearts and minds of those vulnerable to its destructive message.

That will take time.

As I said last year, we have already contributed to the humanitarian cause and we are currently examining options to provide more help.

We are also stepping up our diplomatic efforts to counter ISIL and support stability in Iraq.

As part of this, we are looking at options to base a diplomatic representative in Baghdad to serve as a conduit between the Iraqi government and our military deployment, as well as assess how we can support better governance in Iraq.

We will also expand our diplomatic engagement on international counter-terrorism by appointing a new Ambassador for Counter Terrorism.

Underpinning all this, we will work as a member of the UN Security Council to advocate for effective action on ISIL.

Mr Speaker, last November I told New Zealanders ISIL had been successful in recruiting New Zealanders to its cause.

Our Government agencies have a watch list of between 35 and 40 people of concern in the foreign fighter context and that remains the case.

Unfortunately an additional group requiring further investigation is growing in number.

We have strengthened the ability of our intelligence agencies to deal with this and they are taking steps to add to their resources.

We cannot be complacent, as events in Sydney, Paris and Ottawa have underscored.

To those who argue that we should not take action because it raises that threat, I say this:  the risk associated with ISIL becoming stronger and more widespread far outweighs that.

I know there is already risk.

New Zealanders do too, because they know we are a nation of prolific travellers who have been caught up in terrorist activity around the world many times before.

Mr Speaker, the Government has carefully considered our contribution to the international campaign against ISIL.

We are prepared to step up to help.

New Zealand does not take its commitment to Iraq lightly.

In return we expect that the Iraqi government will make good on its commitment to an inclusive government that treats all Iraqi citizens with respect.

Sending our forces to Iraq is not an easy decision but it is the right decision.

They will go with our best wishes.

To the Dom Post again:

. . . All the signs suggest that Key is doing what Keith Holyoake did in Vietnam – sending the smallest possible force into the war, mainly to keep the allies happy and to show the flag. And probably the most that can be hoped for from this war is to contain Isis and stop it from building a lasting fundamentalist caliphate.

If it can’t build the caliphate, it loses its theological reason for being. And it then might lose some of its support, and splinter under its own murderous fanaticism. None of that is certain to happen, but it is a defensible aim for limited Western military intervention. It is the best option available.

There is no best in situations like this, but sending a limited number of troops to train the locals for a limited time is less worse than the alternatives.


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