Articles - September 2016

New Zealand Ambassador

Brings Trade Expertise to the Global Stage
James A. Winship, Ph.D.

New Zealand's recently named Ambassador to the United States, Tim Groser, brings unparalleled experience in international trade negotiations to his new position. At the same time, he serves as New Zealand's Special Envoy to the Pacific Alliance. He knows the Asia Pacific Region intimately, and he understands national security issues.

Tim Groser is a politician as well as a diplomat. He was elected to Parliament for the first time in 2005 and served as opposition spokesman on trade. Since Prime Minister John Key and his New Zealand National Party achieved a parliamentary majority in 2008, Ambassador Groser has served in the Prime Minister's Cabinet as Minister of Trade and Minister Responsible for Climate Change Issues.

He began his government career as a Junior Investigating Officer with the New Zealand Treasury. He moved up the economic career ranks focusing on Australia-New Zealand economic relations all the while gaining multilateral trade negotiating experience. In 1986 he was appointed Minister (Economic) with the New Zealand Mission to the General Agreement on Trade and Tariffs (GATT) and Chief Agricultural Negotiator. Subsequently he became New Zealand's Chief Negotiator for the GATT Uruguay Round, which succeeded in bringing agriculture into the world system of trade rules for the first time.

Groser served as New Zealand's Ambassador to Indonesia from 1994-1997, returning home to serve as Principal Economic Adviser to the New Zealand Ministry of Foreign Affairs and Trade. Following a stint as Chief Executive of the Asia-New Zealand Foundation, Ambassador Groser was named as his country's Ambassador to the World Trade Organization (WTO) where he served until his election to Parliament in 2005.

His resumé has all the earmarks of a trade geek except that his back story is much too interesting for that. True, much of his diplomatic career has focused on complex trade issues and the intricate negotiating that goes with them, and once upon a time he planned on being an economic historian. But, Tim Groser's parents were professional actors, and his earliest career was as a professional child actor on radio drama and early television soaps, including some stage appearances.

The hand writing may have been on the wall, however, the future Ambassador's first job as a 16-year old teenager was as a "waterside worker," a longshoreman on the docks. "I was employed," Groser recalls fondly, "as what we call a 'sea gull.' If you think of the metaphor, what does a sea gull do on the wharfs? They pick up the scraps. So, you turn up at the docks at five o'clock in the morning, and the first jobs go to the union guys. Then you pick up the scraps. If there are a lot of ships in town, there's a lot of work and you get a good wage. To me as a 16-year old it was an amazing wage. And, I enjoyed every minute of my time as a waterside worker." That's learning international trade from the ground, or rather from dockside, up.

At age twenty-two, Ambassador Groser "had three careers on the go. I was an actor, a profession I could have carried on. I was playing in a rock band, so that was an option. [NOTE: There are still two, apparently well-used, guitars close by the desk in his Washington office.] But, I was actually doing a Ph.D. in economics." The impending birth of a child, however, led him to drop his Ph.D. program and get a "real" job. He joined the Ministry of Finance as a junior economist and then moved into the Foreign Ministry.

"I came out of my academic background to get involved in external economic policy. And, I've always been utterly fascinated by this. It doesn't matter how long I keep doing it," he insists, "I still find it endlessly fascinating. That's the real story behind my career."

Diplomatic Connections: Ambassador Groser, welcome to Washington after a long and well-traveled career in the international trade realm, in the climate realm and many others. You presented your credentials to President Obama earlier this year. What are your priority goals for your time here as Ambassador?

Ambassador Groser: The immediate priority goal is to do what I can to assist the administration and supportive members of the Congress to get TPP, the Trans-Pacific Partnership Agreement through the U.S. Congress. This is of immense importance to the United States as well as to Japan, and Australia and my own country. That is the immediate priority.

Longer term, as my predecessors all pointed out to me, in this town the political security and intelligence relationship is at the base of any country's relationship with the United States. That always needs a bit of gardening care: "taking the weeds out" and sorting through misunderstandings. Our relationship with the United States in the security and intelligence realm is an extremely good space now. That would be my longer term responsibility — to manage the political relationship.

Diplomatic Connections: You mentioned how important TPP, signed in Auckland earlier this year, is for the United States, not just for New Zealand and the other partners. As well you know TPP has become enmeshed in the American presidential campaign in ways that have led all of the candidates to come out against the TPP agreement, at least in its present form.

How would you "sell" the agreement to the Congress and to the people of the United States? What is the importance of TPP from New Zealand's point of view and from the United States point of view?

Ambassador Groser: I'll try to put it in U.S. terms. The first point deals with the overall importance of international trade itself. The United States is not a loser in international trade. The United States is the largest economy in the world and has some of the most competitive agriculture, services and industrial companies in the world. People are losing sight of that simple reality. The idea that the U.S. industrial heartland does not exist any longer is wrong. Trade intensive manufacturing brings the highest paid jobs in the United States for the ordinary citizen. In terms of what are called trade intensive manufacturing companies the average wage is $94,000/year. That is close to 60% above the U.S. average wage.

Second, in the last 25 years the United States has quadrupled its exports of manufacturing to $1.4 trillion, more or less. Frankly, the argument that the U.S. cannot do manufacturing just does not hold water when you look at the data.

What has happened to the middle class, of not just the United States but a number of other countries, is a very complicated picture. But, it wasn't created by trade policy, and you can't fix it by trade policy. Trade works, and the United States actually enjoys a surplus in manufacturing exports over imports with all of its FTA partners.

Diplomatic Connections: Does the TPP involve strategic issues as well?

Ambassador Groser: TPP does not directly involve strategic issues, but there are broader strategic implications. Despite obvious structural problems in the region, the Asia-Pacific is the place where the action will be in the 21st century.

I don't want to put this in some crude sense of China vs. the United States. My view is that all countries in the world need China and the United States to have a highly productive relationship. As the differences arise, there will always be difficulties in this relationship, as there are between the United States and any major country. The issue is not whether there are problems. The issue is how those problems are managed.

This is not some sort of anti-China point I'm making. Far from it. New Zealand has an outstanding relationship with China. We probably have the best set of trading relationships that any country has with China. My point, however, is that the United States cannot play the role that countries like New Zealand want the United States to play and not have an economic agenda. And that economic agenda is TPP in terms of formal trade, investment and integration.

If the United States, for whatever set of political reasons, just walks away from this role, who is going to pick up the ball? Even though the United States is still the supreme country in the world, the number one economy in the world, the world will not stop. The world will move on. Even if the most important country in the world absents itself from the action, that remains the reality.

Diplomatic Connections: You know that the visceral response on international trade almost always involves the economic dislocation of workers whose jobs are impacted negatively by the flow of international trade because of an adjusting global economy. That is certainly what the current political campaign in the United States has focused on. How do you respond to those concerns?

Ambassador Groser: This process of globalization is driven almost overwhelmingly by technology, not actually by formal trade negotiations. Today there are dozens and dozens of countries involved in making any item. This involves massive change. This is not going to be stopped by a political decision. That is the cause of economic dislocation. The point I'm trying to make is that this process does involve dislocation, but it brings enormous benefits.

What we have to do politically is to explain this to our electorate in simple terms. Not because they are stupid, but because they are not endlessly fascinated by these issues. The best way that my Prime Minister has solved this, if you use the language of bumper stickers, is phrases like "We ain't gonna get richer by selling to ourselves, guys." And there's a U.S. equivalent to that. It is, "Sorry, 95% of the world's consumers are not inside the United States. You want to walk away from that market?"

I always say that in politics you need to have slogans. You need to be able to simplify a message for an electorate, whether it's on trade, climate change, security, relations with China . . . whatever. But, it is the height of irresponsibility not to have a policy that is consistent with that bumper sticker. Otherwise it is either false rhetoric or its deception.

Diplomatic Connections: You mentioned that the security relationship between New Zealand and the United States is in a very strong place now. Historically, this has been a rocky relationship — especially on nuclear issues. In 1987, New Zealand declared its territorial waters, land and air space to be a nuclear-free zone and prohibited nuclear powered ships from making port calls or entering its territorial waters. In reaction, the United States suspended its historic ANZUS treaty security commitments.

Ambassador Groser: Yes, if we go back 30 years, the security relationship between our countries was very difficult. Without raking over old coals, the tension between us was triggered by a variety of things. The anti-war movement, which surged throughout the world, was something that I had grown up with at university. At that stage, the French were still doing atmospheric nuclear testing in the Pacific, which outraged New Zealanders. So, out of the anti-nuclear movement came this problem with all things nuclear basically.

Fortunately, we put Humpty-Dumpty back together again. We now have got an outstanding political, defense and intelligence relationship with the United States. In the last few months the government of New Zealand has taken decisions that have gone down extremely well with the administration in Washington and with the Pentagon.

We have committed ourselves to doubling our intelligence spending over the next four years. We're going to put another $20 billion on the table for new defense expenditure, which is not chump-change. It's obviously not huge by U.S. standards, but we are only 4.5 million people. We've just announced that we are recommitting ourselves to maintaining our small operation in Afghanistan working along with the British NATO-led system. We've also committed to staying in Iraq and have 143 defense personnel there training Iraqi troops to be more effective soldiers.

We have a small army, but they are incredibly good at what they do. Our special forces are among the best in the world.

Diplomatic Connections: They are also incredibly good at humanitarian assistance.

Ambassador Groser: They are indeed. We have had 500 defense personnel in Fiji until recently helping the Fijian government with their own hurricane relief operations.

The reality is that we partner with the United States on almost every single major strategic challenge the United States provides the muscle to. And they appreciate what we do. There is a political element to our strategic relationship. But, there is a niche capacity there that New Zealand provides that makes a material difference. I know because I've talked to extremely senior U.S. military people who tell me that our people have done great things in Iraq and Afghanistan.

Diplomatic Connections: New Zealand has also just recently signed a Technology Safeguards Agreement with the United States. Could you tell us about that?

Ambassador Groser: Let me tell you about Peter Beck, who is by training an apprentice plumber. He is now one of the world's most effective rocket scientists and CEO of RocketLab. He has invented technologies that radically reduce the cost of launching rockets carrying small payload satellites into outer space.

The crude way to explain this to non-science people is to say that there is an explosion of demand for satellite coverage. There are two ways to do this. One is to put a very large satellite very high to maintain a certain footprint over this ball that we call our planet. Or, you can insert lots of smaller satellites into lower earth orbit, and Peter Beck does that — lots of little satellites.

And, there are serious security implications behind this. It is important to assure that this technology is used only for civilian purposes, that there is no leakage of this into areas that the United States, New Zealand or Australia would not be comfortable with. So this required a complicated, very technical negotiation.

The first launch under this agreement will take place in a couple of months from a remote part of New Zealand and is an absolutely perfect site for a number of technical reasons for launching multiple rockets. Distant New Zealand is simply more remote than you could be anywhere on the North American continent.

We think this agreement is going to turn out to be a major boost to high tech industry in our country.

Diplomatic Connections: Much earlier in your career, you served as New Zealand's Ambassador to Indonesia. What did you learn from that experience that carries over to this new diplomatic position as Ambassador to the United States?

Ambassador Groser: How important Indonesia is. That would have been a controversial thing to say twenty years ago, but I think it is now the reality. The whole international system is slowly accommodating itself to the reality that Indonesia is a vital country, and one that is making enormous progress.

Indonesia has averaged close to 6% growth for a quarter of a century and per capita income today is around $4,000. That's four times what it was when I was Ambassador there. So, Indonesia is now a low middle income country, not an impoverished country and will exert huge influence in the next 50 years. I have no doubt about that.

Diplomatic Connections: In Indonesia you clearly had a very close encounter with Islam. If TPP is an emotional issue, Islam right now is even more so. What did you learn that you think would be useful in the present situation where, politically at least, Islam and terrorism have been made virtually synonymous?

Ambassador Groser: The number one thing I'd say is that moderate Islam is the best friend of the United States. Our problem has never been with Islam.

We cannot win this battle against terrorism without the support of believing, faithful Muslims. And Indonesia, being the largest Islamic country in the world is on the frontline. We can only win the fight against terrorism and those who distort Islam to their own violent purposes with the support of the vast percentage of the 1.4 billion people in this world who say they are Muslim. That's the simple reality.

Diplomatic Connections: Your government has been very active in promoting the candidacy of Helen Clark to become Secretary General of the United Nations following the end of Ban Ki-moon's term. How would you evaluate her credentials for that job?

Ambassador Groser: We are strongly supporting Helen for this position. We think the multilateral system needs a strong Secretary General, somebody with great political experience. I think it's a remarkable statement that the current Prime Minister would come out so strongly in support of the very person that he finally managed to beat to become Prime Minister.

Helen Clark has had nine years of hard experience at running a country as New Zealand's Prime Minister, and now she's had seven years of experience as Administrator of the United Nations Development Program and Chair of the UN Development Group, which coordinates all UN development related agencies. There are only two things a Prime Minister deals with — the easiest and the most difficult. The practical experience of being the ultimate decision maker is exactly the type of person we want to be Secretary General.

Diplomatic Connections: In his letter nominating her for the Secretary General's position Prime Minister Key suggests that, "As a New Zealander Helen Clark is well placed to bridge divisions and get results." What is special about being a New Zealander in diplomacy?

Ambassador Groser: In international diplomacy, you don't just pursue your own interests. You realize your limitations. If you just put forward something made in New Zealand for New Zealanders, it is DOA — dead on arrival. That's a consequence of knowing how physically isolated we are. We have only "soft power" not "hard power."

If New Zealand's diplomats prove more effective in some circumstances, it is, in my view, a direct consequence of our size and being able to free ourselves up intellectually to understand how the world looks to other countries. When I was a negotiator for New Zealand both as an official and as a minister, my first question to my team would be: "What do these guys want? What are their real objectives? How can we advance our objectives within the framework of their interests?"

Diplomatic Connections: You are at the Foreign Service Institute teaching the incoming class of new foreign service officers from university. What do you tell them?

Ambassador Groser: The first lesson is: Try to understand the other country's point of view. In my experience even ridiculously extreme positions have a base to them. Second is: When you're dealing with individuals, don't make personal judgments about whether you like that person or not. Instead, work out early on who you think is dealing in good faith; they can be extreme and still negotiate in a favorable way. In most cases diplomats do negotiate in good faith. The key to it is to try to get behind their objectives and then to suggest an alternative way by which they can realize their objectives.

In terms of tools of the trade, I'd say learn one language at least. Language opens your mind to a different way of looking at life. It is a very important skill for a diplomat to see the world through lenses other than their own.

And, one last ironic observation. What is really intriguing is that historically New Zealand has worried about isolation, and properly so. Right now that isolation is starting to look like the biggest single advantage New Zealand has because the disadvantages have been destroyed by digitization and reduced transaction costs. The advantages of physical distance in this very, very difficult world that we see unfolding right now are enormous. So, it's really odd. What was called, it's actually an Australian term but it applies even more strongly to New Zealand, the "tyranny of distance" turns out to be exactly the opposite.

Diplomatic Connections: Ambassador Groser, thank you for your time and your insights.

FREE Digital Edition
See and read Diplomatic Connections Magazine
View Archived Digital Editions