Luxon visit highlights NZ–Singapore push for trade resilience

In a world of constant disruption, New Zealand is leaning on partners it can rely on.
Singapore is one of them, and this week’s visit makes that clearer than ever.

“We’ve got so many angles to this relationship,” Christopher Luxon, Prime Minister of New Zealand, said from the muggy heights of Singapore’s Cloud Forest.

Luxon spent Tuesday morning at Singapore’s ANZ building, hosting a roundtable on supply chain disruption with the likes of Zespri, Comvita, New Zealand Trade and Enterprise and the Ministry of Primary Industries in attendance.

Luxon at the roundtable hosted at ANZ’s Singapore office, with companies including Zespri and Comvita alongside government agencies. Image credit - Anna Whyte

In his opening remarks, Luxon pushed for the need to have a “braver” conversation around medium to long term structural reform and to talk about the crisis in regard to what they were seeing in costs and logistics.

After the roundtable, Luxon said they spoke about what they can do over the next 15 years to improve supply chain efficiency, “So that we can continue to actually grow our economy and get our exports to market all around the world," he added.

It followed New Zealand and Singapore signing the agreement on Trade in Essential Supplies (AOTES) to ensure New Zealand and Singapore keep trading essential goods during crises, and when supply chains are disrupted, it means no export restrictions would be put in place. It is to be incorporated into the existing New Zealand-Singapore Free Trade Agreement.

Luxon with Nicola Willis, Minister of Finance of New Zealand in Singapore. Image credits - Anna Whyte

Fuel, of which NZ sources a third from Singapore refineries, is a key part of this agreement for NZ as well as pharmaceuticals and construction supplies, while food is an important part for Singapore.

Luxon visited Singapore’s refineries on Jelong Island on Monday, followed by a trip to its naval base where he jumped on a small boat.

While the trip’s main objective was to further solidify political, strategic and business relationships between Singapore and New Zealand, the looming economic fallout from the Middle East crisis remained a constant talking point across the political and business delegation.

In the two days the visit ran, news headlines swung dramatically.

It went from US President Donald Trump pledging to begin guiding ships through the Strait of Hormuz with guided-missile destroyers, aircraft and 15,000 service members - a move Iran said would violate the ceasefire, to a military escalation from both sides, with Trump warning Iran forces would be “blown off the face of the Earth” should it target the US.

Luxon said the world had moved into an era where, in pursuit of their national interests, major powers in parts of the world are picking and choosing the rules that apply to them. Image credits- Anna Whyte

At the opening of the Singapore-New Zealand Leadership Forum on Monday, Singapore Prime Minister Lawrence Wong told the audience of business delegates that the shocks spurring from the crisis. "It reminds us that perhaps, such shocks are no longer one-off - they are becoming part of the new normal in our business environment," he said.

"We cannot assume that markets will always function as before. We have to diversify, de-risk, and build resilience into our systems. Governments have to do so; I’m sure businesses have to do this too, as part of your business continuity plans," Wong added.

Luxon said the world had moved into an era where, in pursuit of their national interests, major powers in parts of the world are picking and choosing the rules that apply to them. "To state the obvious, a world where the powerful do what they will, unconstrained by rules, is not in the interests of small powers like Singapore and NZ," he said.

*Anna Whyte is reporting from Singapore for Interest.co.nz, with funding support from the Asia New Zealand Foundation.

-Asia Media Centre