Don’t assume NZ’s small size means it can slip under the radar, Tim Groser says.
Former Trade Minister Tim Groser says it would be a mistake to assume the United States is too busy taking on larger countries like China and Canada to bother with tariffs against New Zealand primary exporters.
The first few weeks of Donald Trump’s second presidency have been characterised by tariff threats against major global rivals.
While a promised immediate global tariff of up to 20% on all imports into the US is yet to materialise.
He says agricultural protectionists in the US are feeling emboldened by Trump’s America First policies.
Soon after Trump’s election the American Sheep Industry Association told its members it would push for tariffs to hold back surging lamb imports from NZ and Australia. A petition for tariffs on NZ and Australian lamb imports from rival farmer lobby R-CALF gathering dust since 2023 on the desk of former President Joe Biden’s Trade Representative could also be revived.
“This is an opportunity for people to take action against efficient exporters right around the world and that includes NZ and Australia,” Groser said.
Don’t assume NZ’s small size meant it could slip under the radar and not be targeted, he said.
American farmers did not need an executive order signed by the President to get the tariffs they wanted.
Trump’s mere presence in the White House was setting the tone for all levels of the US Government and agricultural protectionists could be confident of a more sympathetic hearing from officials than in the past.
“Governments operate in two different ways in my experience,” Groser said.
“One is formal policy and one is smoke signals. Broad directional messaging that tells bureaucrats which way the wind is blowing.
“Imagine you are a technical official at the US Department of Commerce and you hear from the President nothing but we like free trade…you interpret an anti-dumping complaint differently to if you are hearing the President say it is all desperately unfair and the US has got the raw end.”
Groser said while many of Trump’s advisors were “closet free traders” it remained to be seen how far they could rein him in.
While tariffs featured in Trump’s first term key advisors prevented him from going further.
Most famously his chief economic advisor swiped an executive order ripping up the Korea-US free trade deal from the President’s desk before he could sign it.
“This is not the game we are playing with Donald Trump today,” Groser said.
“His people are better organised. They know what they are doing and have identified the deep state as the enemy.”
In the meantime, challenging Trump’s protectionists policies through the World Trade Organisation like NZ and Australia was able to do the last time the US hit the countries’ lamb imports with tariffs in the 1990s could no longer be counted on, Groser said. Trump knee-capped the global trade court after he refused to appoint judges to its appellate body last time he was President.
The most likely factor in Trump’s protectionist policies unravelling was pressure from his fellow Republicans to reverse any tariffs should they lead to a spike in the cost of living in the US, and tit-for-tat tariffs against US companies, Groser said.
“He doesn’t care at the moment because he thinks he is invincible but if the Republicans start to think they will lose the House in two years’ time that changes it a lot.”
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