Todd McClay: Trade Minister on being one step closer to signing a trade agreement with Switzerland

Trade Minister Todd McClay addressed media with his Swiss counterpart Helene Budliger Artieda at the Future of Investment and Trade (FIT) Partnership ministerial meeting in Auckland to announce trade partnership talks. 

Limited details are available as the talks are in the early stages.

"What we've agreed today is to start a formal trade investment dialogue," McClay told Heather du Plessis-Allan.

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Episode Transcript

Speaker 1 (00:00):
Now New Zealand might be one step closer to signing
a trade agreement with Switzerland. This is off the back
of the big trade discussions happening in Auckland today. Tod
McLay is the Trade Minister.

Speaker 2 (00:08):
High Todd, Hey, Heather, how are you.

Speaker 3 (00:10):
I'm very well, thank you. But is dairy off the table?

Speaker 2 (00:13):
Is it? Well, no, we haven't started negotiating, although we
do know that dairy is a challenge for Switzerland because
they have a lot of subsidy. But what we've agreed
today is to start a formal trade and investment dialogue.
Officials will meet in September and start scoping out what
a trade agreement could look like and whilt there's no
commitment on either side. I do think that we're like

(00:34):
mine that and during the course of next year we
could launch the negotiations and they will get around the
negotiation table. But this is a very very wealthy European
nation that actually can consume a lot of a lot
of what New Zealand producers and for New Zealand companies
up in the EU taking advantage of our current trade
a deal, it's a very short step across the border.

Speaker 1 (00:57):
Get given the fact that they have said, it's probably
not going to happen and we're not going to have
greater access. I mean we can probably we probably shouldn't
pin our hopes on it, should we.

Speaker 2 (01:05):
Well look at actually, if you look at the dairy
products they consume, they're they're quite high value, so they're
not the milk powers and stuff that we often sell.
They've just done a trade deal with the UK and
there is dairy in that. It's a very high value
cheese and some other things. Yeah, even some chocolates. So look,
we're not we're having started negotiations. We wouldn't do it
through the media. But as with everything, we'd be going
in to get the very best.

Speaker 3 (01:27):
Okay, what do you think they are going to buy?

Speaker 2 (01:29):
A million people that is one of the wealthiest in
the world. Is that you know, it's a big opportunity
for New Zealand.

Speaker 3 (01:34):
Apart from the high end dairy products, what do you
reckon they'll want from us?

Speaker 2 (01:38):
Well, well, there are many things actually, you know, we
look that we might produce meat and so on, but
putting that aside, a lot of it for us would
be around the services trade. You know, some of the
things that we do very well. The innovation, the science,
our service exports are doing well around the world, and
this is a market that can consume that very very well.

(01:58):
In turn, if you look on the other side, there's
a lot that they do that big and investing around
the world. They are wealthy, and we'd love to bring
more of their investment down here. They're also very big
pharmaceutical manufacturers. So you know, this is not a game
changer for New Zealand, but it's another piece of the
puzzle of giving key Week's access to a market of
wealthy people so that they can keep producing and selling
and rebuilding the economy.

Speaker 1 (02:20):
Okay, now the US tariff, are you expecting it to
go up to twelve and a half percent overnight?

Speaker 2 (02:26):
I don't know whether it's overnight, but it is likely
to be over the next week. Whether you remember that
when we went to fifteen percent, the US courts found
that that was illegal in all countries of the world.
The US put in place a ten percent for one
hundred and fifty days as they work through a process.
We were told, and you know, we spoke about it
publicly a month or so ago, that we were likely

(02:47):
to go back to twelve and a half percent that
one hundred and fifty days is about to run out.
So yes, I do expect that's likely to happen. We
don't have an indication if the President has decided countries
in the world are going higher than that. And whilst
it means that we are two and a half percent
lower than last time around, you know, one, it is
harmful for trade, and it does mean that US consumers
will pay more for what New Zealand is producing because

(03:10):
we know they're still buying from US.

Speaker 1 (03:11):
Yeah. Is it actually having an impact on businesses here?
All of this up and down down the tariffs.

Speaker 2 (03:16):
So for some smaller businesses who've been reliant upon the
US market, it is very very hard for them. But
for the majority of our exporters, their volumes or values
have not been going down. I mean, over the last year,
even with this changing tariff rates, we've sold them by
value about four percent more. We've increased what we're selling them.

(03:37):
But it is the uncertainty that it's making very hard
for our businesses. You know, it was twelve percent, fifteen percent,
ten percent, you know, twelve and a half. Who knows
what will be in the future. I think that's why
you're seeing New Zealand exports, looking in markets elsewhere Europe
where we're doing well. China we're going back to and
doing a lot, you know, a lot of interest in India.
So there are opportunities still out there even though we

(03:58):
are still selling more to the US with this unusual
changing nature of President Trump's trade decision making.

Speaker 1 (04:05):
Todd Listen, thanks very much for talking us through it.
Really appreciate it. Enjoy a week in Tod McLay Trade Minister.
By the way, sorry for the quality of the liner.
Kept on dropping in

Speaker 2 (04:11):
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