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Buttering up Russia

Written By: - Date published: 11:00 am, November 15th, 2010 - 30 comments
Categories: exports, Minister for Overseas Holidays - Tags:

What’s so great about free trade negotiations with Russia? We export only $180 million a year to them, most of it butter. That’s 2% of our exports to the US and Japan but Key’s made no progress on their trade barriers. And peak oil will soon make sending our butter all the way round the world uncompetitive vs Russian dairy farmers.

Russia is a third-rate country with a GDP per capita on par with New Caledonia. It’s also one of our furthest export destinations in terms of carbon miles – goods either go right round to Europe and then into Russia or up to Vladivostok and across by train. It has its own dairy industry, which is growing strongly. Russian government policy is to move towards self-sufficiency in food, including producing 90% of its own dairy by 2015. Hardly the most attractive market.

Still, Key got his photo op. He sat and played with an ipad with Putin’s puppet, Dmitry Medvedev. Can you feel the sheer export value radiating from that meeting, New Zealand?

Key was meant a “chat” with Obama – you’ve got to love Vernon Small taking the piss out of that:

“Key has secured a treasured “chat” with United States President Barak Obama… Under the rules for the meeting, set by the US, New Zealand media would be allowed only one stills photographer – a decision Mr Key said yesterday was disappointing.

His officials were working last night to relax the restriction, which would deny Mr Key valuable media coverage, especially television footage, of the opening of the event.”

But there’s no reporting that this one-on-one meeting actually took place. Maybe Obama decided he had better things to do than be Key’s photo op.

30 comments on “Buttering up Russia ”

  1. happynz 1

    Russia as a market for dairy products is odd. It didn’t stop TV3 from gushing about it though. I think I heard something about the PM sitting next to President Obama during some leader function and the report was that the two had a chat about free trade.

    Does Key actually do anything but smile and announce free trade deals (and you know Duncan Gardner will be there to announce in serious tones what a diplomatic and economic boon it will be for Kiwis as a result of Key’s wonderfulness, or something like that).

  2. Blighty 2

    no photos with Obama but he got really close to him!

    “Key told reporters he sat “pretty much next to” President Obama at a Kabuki show of traditional Japanese drama before a leaders’ dinner last night. ”


    He continued ‘OMG!, OMG! You guys, I could practically have reached out and touched him! But I didn’t of course because that would have been totally uncool. I called him Barack and he seems cool with it. He’s such a cool guy!

    spam-word: ‘leavings’ – yup, a pile of sh@t from the PM again.

    • M 2.1

      Two short chats, eh?

      Would that be “Hello” and “Goodbye” ?

      ‘Pretty much next to’ is like being one number off winning first division in Lotto.

      Anti-spam: invented – apt

  3. ghostwhowalksnz 3

    Key has truly become the Zsa Zsa Gabor of international politics:

    Always standing next to someone more famous

  4. g_man 4

    So Russia as a market for dairy products is odd, and probably going to dry up? Seems like Fonterra and the Dairy Companies Association disagree with that, but what would they know?


    But as you say, what’s so great about free trade negotiations with Russia? Other than the small fact that we’re the first country in the world to start negotiations.


    • Blighty 4.1

      russia isabout 1% of fonterra’s exports. just because the herald says they’re excited doesn’t mean it really matters to them.

      a good rain in southland does more for fonterra’s revenue than russia.

  5. smhead 5

    Yet another “john key is evil and do nothing” post.

    Russia is the world’s 12th largest economy. Bigger than Australia and Korea, and soon set to overtake Germany France and UK. Kazakstan which is included is the same size as the NZ economy.

    Bet you were saying the same thing about a free trade deal with China (the Chinese don’t even eat cheese you say!) yet it’s now a billion dollar trade relationship.

    Russia is no more distant a market than the EU.

    • Blighty 5.1

      Russia is actually further than the EU, because the boats go to the EU, and then on to Russia.

      Russia might be a large economy but it is poor on a per person basis and a tiny market for NZ goods.

      Basically, all we sell to them is butter and they’re trying to produce enough of their own that they won’t need us. I guess that’s what Groser meant by ‘future-proofing’ our trade with them – not growth but trying to protect what we have, which is a tiny market – less than 0.5% of our total exports.

      • Colonial Viper 5.1.1

        Also Russia looks like a bigger economy than Australia because of its sales of what? Oil and munitions.

        • Lanthanide

          Saudi Arabia is poised to re-take the mantle as world’s largest exporter of oil. Worryingly this is not because of any particular bump in output from Saudi, but a drop in exports from Russia…

    • KJT 5.2

      Yeah. “Free trade” with China is so good for NZ.
      They would have brought our coal, farms and logs anyway.

  6. Kaplan 6

    His officials were working last night to relax the restriction

    Every time I see this it makes me madder. Because you know that’s what his taxpayer funded officials should be working so hard on. Fucking Photo Ops.
    Get a grip Key you clueless dickhead.

  7. ianmac 7

    Thanks Kaplan. My first visit to the PM’s blog.
    National Standards: Interesting that he highlights the kids who are known to be failing but apart from trying to re-measure them, he does not offer solutions to solve the problem. Instead spend over $30million on the the remeasuring. And he believes that the bulk of schools are in agreement with NS. A pity that he will not be interviewed on such topics.
    Still it is a good idea to blog although I nearly dropped off given his very ordinary delivery.

  8. RedLogix 8

    I’ve not the time for a substantive reply…but I completely disagree with you on this one Marty. In many ways I think Russia is an ideal trading partner and this particular deal will turn out one of the better ones.

    • ghostwhowalksnz 8.1

      Could well be the case- if effort is made for the next five years and money spent .

      Cant see Key being interested beyond next month, or McCully,

    • Fisiani 8.2

      What’s so great about free trade negotiations with Russia? We export only $180 million a year to them, most of it butter.

      Are you serious???????
      That is now.

      If we increase Russian exports 10 fold we export $1800 million a year. The economic illiteracy shown on this blog is mind boggling.

      • Colonial Viper 8.2.1

        Hey Fis, I guess if we increase Russian exports 120 fold we’ll export $21.6B a year. Cool huh?

        Of course, we’ll have to cut down all our national forests and turn them into dairy farms, but other than that no problemo!

        • Bazar

          I compleatly agree Viper.

          We should shoot all our cattle and encourage all nations to put tariffs on anything we export.

          Working towards a better, greener future.
          *thumbs up*

          • KJT

            But wait. Most of our trading partners have got tariffs or restrictions on things we export already.

            Not to mention they subsidise their farmers and manufacturing.

            Some of them, like the EU, even have laws protecting their workers.

            Don’t you think they may know something we don’t?

            • Bazar

              I don’t really care what they think they know.

              I care about our trade, and i know its because of tarrifs and laws protecting their workers, that we have a hard time exporting some products to them. Like dairy products.

              If your suggesting we should implement tarrifs, or that euroupe is just smarter, thats offtopic.

              If your suggesting that NZ should subsidise our farmers, you may have a point. But i on this site, you’d be looking at the rich get richer viewpoint, so beware.

              Otherwise i haven’t the foggiest what its about, unless its a potshot at national.

              • KJT

                No. It is a shot at the idiots who totally opened up our economy so all our jobs and manufacturing disappeared, leaving us nothing left to bargain with and now they want to do more of the same. “Free trade” and comparative advantage are theories which even the originators qualified.

                Farmers are already heavily subsidised by the rest of us. If you don’t believe that ask any farmer how much tax he pays.

      • bbfloyd 8.2.2

        fis..you could set your post to music…… i know of a prussian marching band that would do a great job for you… we can hop in the tardis and go back to the 1930’s when they were popular with all the best militias. they would suit your style perfectly..

  9. Colonial Viper 9

    Clinton met Key, Obama got her report, decided not to bother.

    That ’bout sums it up?

  10. BLiP 10

    Isn’t this “trade with Russia, John Key’s wonderful” just another example of National Ltd™’s spin meisters repackaging old news? I mean, what’s actually changed since June?

    • Lanthanide 10.1

      Yeah, it sounds like a desperate “damn, nothing on the US front. What else can we trot out now?” fallback position.

      captcha: theorys

  11. Sanctuary 11

    Can someone tell me WHY we would want a free trade deal with a semi-lawless gangster state run by a corrupt oligarchy of kleptocrats? Are we really that desperate? Or is Rortney and his buddies looking for pointers on how better to loot the state?

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