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With New Zealand signing a free trade with Singapore what are the fuel concerns?
Analysis – Christopher Luxon will leave Singapore on Tuesday evening reassured fuel will continue to flow to New Zealand shores, but painfully aware of the trouble brewing on the horizon.
There was a stark warning from his counterpart, Lawrence Wong, at the prime ministers’ joint press conference on Monday.
Singapore’s refineries have adjusted and adapted to the new world of limited supply through the Strait of Hormuz, but Wong was clear that even when it reopens it could be another six months of pain before things correct themselves.
Wong outlined that not only has infrastructure been destroyed in the Middle East, which will slow up any reboot once freedom of navigation resumes, but ships will want assurances that they’re safe from drones and any potential attacks.
That assurance won’t happen overnight, and it could take time for shipping companies to test the waters and perhaps even wait to see others be guinea pig first, before venturing into the Strait themselves.
Wong says his base case is that supply coming through the Strait of Hormuz “remains limited for quite a prolonged period of time, at least to the end of the year, perhaps even beyond”.
Singaporean Prime Minister Lawrence Wong. Photo: SUPPLIED
Luxon has also shifted his tone recently, upping the rhetoric about how New Zealanders must be feeling about the ongoing fuel crisis, while also trying to reassure people there’s nothing to worry about.
In Singapore that language escalated to a comment that New Zealanders watching the news are “seeing the world literally on fire”.
“You’re seeing it in the conflict, and you’re seeing the rules-based system that we used to uphold being sort of upended, and that comes with huge amounts of anxiety and worry and concern.”
The new intelligence Luxon and his fuel and finance minister Nicola Willis collected in Singapore from the big five energy companies was that although the feedstock they’re getting is different and requires adaption at their refineries, they’re still able to meet “the needs of all their customers”.
Trade Minister Todd McClay, Prime Minister Christopher Luxon and Finance Minister Nicola Willis in Singapore. Photo: Supplied / PMO
The assurance Luxon and Willis received was that things will get bumpier over time but there’s no risk to supply currently and into the next few months.
Willis added that she was impressed by how “front of mind” New Zealand is for these Singapore-based refineries.
“Exxon Mobil was very conscious they’re supplying fuel that helps our transport system operate, helps our economy operate, and they’re very conscious of the agreement between our two governments.”
That agreement on essential supplies continuing to flow during times of crisis was officially signed by the trade ministers on Monday.
It’s a world-first and already other countries are looking to the deal as an opportunity to secure some of their own guarantees.
Luxon’s sense is that other southeast Asian nations will probably be first cabs off the rank for something similar, which both New Zealand and Singapore are very open to.
Wong says he welcomes other countries joining what is a new and innovative approach to trade.
“If they’re able to meet the same standards then it will start to expand a network of trusted partners who can provide similar assurances to one another.”
Luxon added to that saying, “if you can meet the standard and are prepared to back each other, have each other’s backs in the way that we’ve modelled that out, we would welcome that as well”.
It’s a new world order of sorts – small trading nations taking the inward-looking approach of some bigger economies and flipping it to say, keeping the doors open can provide more security rather than less.
(L-R) NZ Prime Minister Christopher Luxon, Trade Minister Todd McClay, Singaporean Minister-in-charge of Energy, Science & Technology Dr Tan See Leng and Singaporean Prime Minister Lawrence Wong. Photo: SUPPLIED
And while together Singapore and New Zealand’s population of about 11 million has nothing on the likes of India, with a population of close to 1.5 billion, the little guys are making a splash in the world.
It was just last week that Trade Minister Todd McClay and many of the travelling business delegation were in New Delhi putting the ink on a free trade agreement that many thought was a pipedream just a few years ago.
The Middle East conflict has no real end point in sight and economies the world over are feeling the consequences of that.
The shining light at the end of the tunnel could end up being the trade agreements and business connections playing out in the background of a punishing and enduring fuel crisis.
RNZ
The chief executive of the Parliamentary Service is confident there will be enough room to accommodate the increased number of MPs and their staff coming into Parliament.
On current numbers, up to 131 MPs could be sitting in the Chamber following the election, brought on by a record overhang result.
Clerk of the House of Representatives Dr David Wilson told the Spinoff that currently the debating chamber had enough chairs to seat 124 MPs – including the Speaker of the House – and work was being done to accommodate more by altering the seating arrangement.
In a statement, Parliamentary Service chief executive Rafael Gonzalez-Montero said planning for a larger Parliament had been going for “some time”.
“Now that the election results have confirmed an increase to the number of members we are looking at several options.
“We are confident we will be able to accommodate all members within the Chamber.”
VNP / Phil Smith
Gonzalez-Montero said office accommodation for members and their staff would be “stretched” for a short time, but the new Members’ Building was only a few months away from “practical completion”.
That building – located behind Parliament – was due to be ready to occupy in April next year and had capacity to accommodate around 30 backbench MPs.
“All members should be in fit-for-purpose accommodation from that point,” Gonzalez-Montero said.
Following the 2023 election, 123 MPs sat in the Chamber – a record number at the time. That decreased to 122 following the resignation of National MP Judith Collins.
Collins held the seat of Papakura and stepped down in May and Parliament voted against holding a by-election because it was too close to the election.
The election result also meant high-ranking National Party MPs like Chris Bishop, Paul Goldsmith, Nicola Willis and Gerry Brownlee – Speaker of the House and an MP for 30 years – would likely not make it back into Parliament.
Only resigning or retiring MPs were permitted to give a valedictory speech meaning none of them would get the chance to give a valedictory statement.
Asked if their would be special allowances for valedictories, Wilson said in a statement that normally only MPs were allowed to speak in the House but the House could suspend its own rules or temporarily alter them.
“It could do so to allow former members to address the House.”
Wilson said no such arrangements could be made until the next Parliament opened and members sworn in.
rnz
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