The Dim-Post

August 10, 2016

Alternate theory

Filed under: Uncategorized — danylmc @ 11:11 am

Via RNZ:

The government says it was aware in May that China had trade concerns and the two governments discussed trade competition issues at the time.
But Trade Minister Todd McClay insists the law prevents him from saying exactly what the dispute was about.

Last month, it emerged the Ministry of Foreign Affairs and Trade had been investigating claims industry players in China had warned the kiwifruit exporter Zespri of possible trade retaliation over claims of steel dumping.

Steel makers were reported to have complained that Chinese manufacturers were dumping excess product here.

The practice of ‘dumping’, or selling surplus goods below cost, is illegal under most trade agreements, and the Chinese industry players were said to have threatened trade retaliation if the claims were investigated.

Initially, Mr McClay described media reports around the issue as “extremely hypothetical”.

Today, he said the two governments were discussing concerns as far back as May.

Labour leader Andrew Little said the government was not being straight.

Or they are being straight, and National’s Ministers are simply so heavily involved in fundraising, marketing and retail politics on behalf of their party they are genuinely unaware of anything happening in their Ministerial portfolios short of a land invasion.

17 Comments »

  1. May be a reflection on McClay’s personal attributes as much as anything?

    Hard to know from outside

    A.

    Comment by Antoine — August 10, 2016 @ 11:15 am

  2. May be a reflection on McClay’s personal attributes as much as anything?

    McClay has great hair and a winning smile. What more can you ask of him, Antoine?!

    Comment by Gregor W — August 10, 2016 @ 11:28 am

  3. Thats interesting that McCaly says he ‘cant legally talk about trade disputes’, which does seem to fly in the face of this:
    New Zealand is currently involved in four disputes – one as a principal complainant and a further three as a third party to other members’ disputes.
    http://www.mfat.govt.nz/en/trade/trade-law-and-dispute-settlement/current-disputes/

    Comment by Ztev Konrad — August 10, 2016 @ 1:00 pm

  4. You have to admire the audacity of a strategy which sees the principal stakeholder refusing to say anything meaningful and then describing any leaks as “hypothetical.”

    I would imagine the law McClay is referring to is a higher law, imposed from above, the one that requires ministers to STFU when the news is bad for the government.

    Comment by teararoawalkers — August 10, 2016 @ 1:44 pm

  5. Yet the laddie knows it is him who will be thrown under the bus to protect McCully and Key. As for ethics, his dad may illustrate what Todd has been raised to believe is OK.

    Comment by Sacha — August 10, 2016 @ 6:49 pm

  6. For a backgrounder on the issue, here’s how much steel China has over-produced:
    http://news.sky.com/story/how-china-is-welded-to-uks-steel-problems-10223333

    “In the past two years alone, China has produced more steel than the total cumulative output of the UK since mass production began in the industrial revolution.
    Or consider this: at today’s rate of production, it would take 68 years for Britain to generate the steel China churns out of its mills in a single year.”

    Comment by Kumara Republic (@kumararepublic) — August 10, 2016 @ 11:31 pm

  7. The problem with Chinese steel hasn’t been that it is being dumped. It is that some of it doesn’t meet specifications for all of its physical properties. The Huntly bypass issue was the steel was not ductile enough, like the recent issue on reinforcing mesh. The manufacturer’s and third party certification can’t be relied upon. This has been an industry problem for twenty years and it isn’t only for Chinese steel. It has also happened for Indian and Korean steel. There is very little US or European steel available, as those countries have closed down their steel making industries to meet carbon emissions requirements. I know that even German steel can have issues. The last set of steel forgings we got from Germany were made from Indian sourced billets. The long term issue has been particularly rife in pressure equipment piping and fittings. The problems lead to non-tariff restrictions like the “Shell” list.
    Failing Charpy notch tests is not a rallying call for the general public. “Dumping” despite being incorrect terminology, makes for lot better soundbites.

    Comment by chrism56 — August 11, 2016 @ 6:11 am

  8. @chrism56,

    I think the (alleged) problem is that Chinese steel is being offered at below cost of production and that it is crappy quality. The former is a trade issue under our WTO/FTA arrangements, the latter is a contract issue between supplier and purchaser.

    Comment by Flashing Light — August 11, 2016 @ 6:56 am

  9. “…and that it is crappy quality…”

    Downright counterfeiting from Chinese manufacturers is an acute problem in the ball bearing business, costing up to 600 BILLION US dollars a year in down time to damaged machinery.

    http://www.powertransmission.com/issues/0410/bogusbearings.pdf

    Comment by Sanctuary — August 11, 2016 @ 9:07 am

  10. get off the overpass as quick as you can and watch the casual crumbling of late capitalism

    Comment by rodaigh — August 11, 2016 @ 11:11 am

  11. Yes it is Chinese steel being dumped. Thats because its Blue Scope, the local manufacturer who is doing the complaining
    “New Zealand is one of only a few countries not currently penalising Chinese steel imports with punitive countervailing duties, but BusinessDesk inquiries confirmed today that the local units of Australian metals group Bluescope had sought an anti-dumping inquiry for Chinese steel from the Ministry of Business, Innovation and Employment some months ago.”
    http://www.nbr.co.nz/article/nz-caught-global-backlash-against-chinese-steel-imports-b-191769

    So , please can we put to rest the idea that this is not an issue. The poor quality just seems another ongoing issue about anything from China. I can remember way back when you could buy floppy disks, the cheap ones from China were exactly 1.44MB but not using the conversion factor 1KB is 1024b

    Comment by Ztev Konrad — August 11, 2016 @ 2:07 pm

  12. So, meeting carbon emissions quotas caused the US economy to lose 600 Billion frogskins in one year alone, by purchasing crappy Chinese steel, as part of a process that has encouraged China to exponentially increase its emissions from steel production to such an extent they have possibly outstripped the UK’s emissions thoroughout the Industrial Revolution, and just over the past twenty years?

    I blame Al Gore.

    Comment by leeharmanclark — August 11, 2016 @ 7:46 pm

  13. While I learnt a good deal about China and steel from some very worthy responses, I was kinda disappointed that this one never took off and has now been relegated, because I was hoping for more discussion on Danyl’s central point. I guess we have the fate of airport luggage to talk about now (isn’t that working so well at diverting us) instead but still, I think this one is a significant lens on this government in its own right, one that touches more critically on its competence and how thin things get once you get one step beyond Joyce.

    Comment by Joe-90 — August 11, 2016 @ 9:18 pm

  14. I agree with Joe, the issue hasn’t been thrashed out. Maybe someone who subscribes can give us the insider view from within the NBR paywall? All I get so far is industry players complaining about the Chinese selling us crap steel. At the risk of seeming naive, how does that differ from anyone who has bought a piece of Chinese technocrap the past quarter of a century to discover that it doesn’t work or breaks down after three weeks?

    So is there more to it than caveat emptor? Could it be that our free trade agreement with China was designed to prevent this kind of shit happening? Did any journalist ask Toddy which law prevented him informing the public? The law against free speech, perhaps? Ok, unfair, it’s the law around private business confidentiality, obviously, but did the journalists get that confirmed? Perhaps the free trade agreement has a clause designed to keep disputes secret.

    If so, what would be the point of that? Machiavelli would probably suggest both governments need the deal to seem to be working – even when it isn’t…

    Comment by Dennis Frank — August 12, 2016 @ 12:36 am

  15. @joe90

    As far as i can make out, this Government has about five senior ministers who make all the important decisions. Junior ministers are just supposed to keep quiet, follow the direction given by the senior ministers and avoid causing trouble. McClay seems to have failed at that last.

    It may not be a bad way to operate in this imperfect world. Not sure how it compares with the Clark government.

    A.

    Comment by Antoine — August 12, 2016 @ 1:09 am

  16. I’m sure I heard a discussion of shoddy steel used in ferro-cement buildings in NZ some time back, and comments surrounding it indicated the lamentable absence of mandated quality standards in NZ, and that steel could be supplied for all manner of purposes regardless of whether it did or didn’t meet the standards currently required in Australia. Is this an accurate perspective?

    Comment by paritutu — August 12, 2016 @ 4:45 pm


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