Negotiating Without Bargaining Power: A Review of ‘New Zealand’s Trade Policy Odyssey’

Abstract

This review focuses on a recent publication from the New Zealand Institute of Economic Research: Chris Nixon and John Yeabsley (2002) New Zealand’s Trade Policy Odyssey: Ottawa, via Marrakech, and On, Research Monograph 68, Wellington: NZIER. It attempts to add value to this useful monograph through additional reflections on lessons from past experience on addressing the central issue of “how best does a small open economy on the edge of the world conduct its trade, and particularly its trade policy, in an efficient and effective manner?” It illustrates the dangers of paralysis of decision-making through excessive political concern about achieving consensus. The growing importance of services, multinational organisations and environmental issues in international trade negotiations increases the complexity of the issues facing negotiators. So too does the increasing significance of bilateral and regional arrangements in the policies of important trading partners, many of them still wedded to high protection for agriculture. The review discusses the implications of these changes. It discusses the contributions nongovernmental organisations have made, and can make, to extending the effectiveness of official negotiators, for example, in research and in the processes of negotiation, and how they can be most effectively harnessed. It also raises issues arising from the changing nature of the debate about effective government assistance to domestic producers engaged in trade, and whether the public sector needs to reconsider the structure and methods of coordination of the official agencies involved in trade negotiation.