Minister of Trade Todd McClay told RNZ the new tariff appeared to be based on countries that had a trade surplus – those who sold more to the US than they buy.
“In New Zealand’s case, that’s about half a billion US dollars … it’s really not significant or meaningful.”
McClay said New Zealand would be making the case about why it shouldn’t have happened and talking with US officials to seek changes.
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McClay told RNZ the 15% tariff rate would be meaningful. At 10%, exporters could pass that on to US consumers.
“But at 15%, that’s going to change the equation.
“We’re getting some pretty urgent advice now that we have detail on what’s been announced.
“It’s not good for New Zealand, but it’s also not good for the world.”
McClay said it would be inflationary for US consumers and make it harder for traders all around the world.
Trade expert Stephen Jacobi said the tariff was unjustified at 10%.
“And it’s now even more unjustified.”
“We impose very few tariffs on the United States.
“They have no major trade issues with us.”
He said the impact of the revised tariff regime on New Zealand exports would depend on the individual sector.
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“I think it’s going to depend, of course, but there may be some water to flow under the bridge on this.”
Today’s statement from the White House said the Australian tariff would stay at 10%.
“Britain obviously is at 10%, but we don’t really compete directly with them,” Jacobi said.
“The EU is at 15%, so that’s the same rate applying to our wine exports.
“Fifteen per cent might not sound like a lot more than 10%, but it is now a very substantial tariff.”
Westpac senior economist Darren Gibbs said the 15% tariff would be disappointing for many New Zealanders, especially exporters.
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But he said it aligned with what Trump had been implying for the past fortnight.
“It’s clearly not helpful.”
He said the salient feature for New Zealand was the benefit Australia had with only 10% tariffs.
That meant Australian exporters could get a competitive advantage over New Zealanders.
“We both sell beef into the US … and lamb as well.”
The wine industry was also likely to keenly feel effects of the tariffs, Gibbs said.
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What the Trump administration referred to as “reciprocal” tariffs were in fact the US President’s assessment of the real value of non-tariff barriers.
Gibbs said Australia and the UK, both facing a 10% baseline, were being rewarded for closer political and military ties with the US.
“Australia and the UK are strategic friends with a big ‘F’.
“He added: “We’re a sort of Anzus subsidiary.”
Gibbs said he didn’t expect much reaction from currency markets to the announcement.
TRUMP TARIFFS
AdvertisementAdvertise with NZME.Australia: 10%Burma/Myanmar: 40%India: 25%Japan: 15%New Zealand: 15%Pakistan: 19%South Africa: 30%United Kingdom: 10%Vietnam: 20%
Additional reporting: John Weekes