United States senators are against a free trade agreement
with New Zealand saying the country's dairy industry has
"anti-competitive practices".
The Dominion Post reported that a letter signed by 30
senators was sent to US Trade Representative Ron Kirk.
Talks started last week in Melbourne on a Trans-Pacific
Partnership (TPP) which would build on the previously
negotiated P4 trade agreement between New Zealand, Brunei,
Chile and Singapore to include the US, Australia, Peru and
Vietnam.
Idaho senators Mike Crapo and Jim Risch led 28 other US
senators, including former Democratic presidential nominee
John Kerry, in urging "very careful attention to dairy trade
concerns" in the letter.
"Because of the anti-competitive practices in New Zealand's
dairy industry and the extensive degree of control it wields
over world dairy markets to the detriment of the US dairy
industry, we are deeply concerned that an expansion of US-New
Zealand dairy trade would further open the US to these
imports," the senators wrote.
Losses to US dairy producers may total up to $US20 billion
during the first decade of the agreement if restrictions were
fully phased out in the partnership, they said.
Trade Minister Tim Groser said the senators were influential.
"It's a real concern. We should make no mistake about it -
this is a very powerful lobby we're taking on."
Prime Minister John Key would lead lobbying in Washington.
Mr Groser said it was "palpable nonsense" to say that
Fonterra had created an unfair market. Though it dominated
the domestic market, it had to compete like every other
company internationally, he said.
The US subsidised dairy producers but New Zealand did not.
"It's a very, very politicised argument, trying to suggest
that somehow New Zealand doesn't play it fair, when any
person who looked at it objectively would reach exactly the
opposite conclusion. New Zealand has enemies on dairy trade
around the world and always has had."
The next round of TPP talks is in Los Angeles in June.
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