The trade minister says a proposed US tariff of 12.5% on New Zealand goods has “nothing to do with forced labour”, and is an attempt to find a legal way to increase the levy.
New Zealand was named alongside 54 other countries, including Australia, the UK, China, Russia, Singapore, and Japan, that had “failed to impose and effectively enforce a prohibition" on goods produced with forced labour.
A statement from the United States Trade Representative proposed imposing a 12.5% tariff on the countries, claiming their acts, policies, and practices had been “unreasonable and burdens or restricts US commerce”.
“We will no longer tolerate this disparity. Some trading partners have taken initial steps to prevent the importation of forced labour goods, including through USMCA and commitments in Agreements on Reciprocal Trade,” Ambassador Jamieson Greer said.
“However, each of our trading partners must do more to ensure that trade does not perversely encourage and entrench forced labour globally.”
Trade Minister Todd McClay said that in his view, the tariffs had “nothing to do with forced labour” – claiming the sentiment was shared by other countries, including Australia.
“There isn’t any [forced labour] in New Zealand. We don’t have goods coming into New Zealand that we re-export to the US.
“This is merely trying to find an actual legal base to put that tariff weight back in place.”
When US President Donald Trump’s “Liberation Day” tariffs were announced in April last year, New Zealand's initial rate was 15%. That rate was deemed illegal by the US Supreme Court and it was dropped to 10%.
McClay said the Government had expected the tariff rate to go up again.
He said the newly proposed rate was “not really a win”, but “there was expectation within the business community in New Zealand and internationally that it would be at 15%".
The US were “just putting it back”, McClay said, and “we were lucky to be at 15%, and for some reason we're 12.5% now".
He said that under the latest proposal, New Zealand would be “a bit better off”.
McClay said officials would be back in Washington DC to make the case that forced labour doesn’t happen in New Zealand and the tariffs are unwarranted
“But the President of America is going to do what the President of America is going to do.”
He said New Zealand would not impose retaliatory tariffs, as they would raise consumer costs.
The minister also maintained that New Zealand’s exports had increased since tariffs were imposed, 4% higher than a year ago.
“We’re doing well in that market.
“It’s as much the uncertainty of the changing nature of tariff rates, than it is the tariff rate itself.
“Although those tariff rates should not be in place against New Zealand.”
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