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Speaker 1: Andrew Dickens, and I'm joined by Peter Lewis from Asia.

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Speaker 2: Hello Peter, Hello Andrew.

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Speaker 1: I'm going to start with the story about China and

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Speaker 1: the Cook Islands because that's been big news in New

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Speaker 1: Zealand because of course the Cook Islands, you know, it's

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Speaker 1: a dependency on New Zealand. They're part of us, they

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Speaker 1: use our New Zealand dollar. You know, they're supposed to

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Speaker 1: talk about this. They went off to China to do

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Speaker 1: a deal without telling us what the deal was, and

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Speaker 1: that gave us all coniptions and put our noses out

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Speaker 1: of joined. I wanted to know, after we've been talking

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Speaker 1: about this at nauseum, here is Asia talking about it?

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Speaker 1: And if they are, what are they saying?

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Speaker 3: They're not talking about it much. Maybe that will increase

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Speaker 3: a little bit. Now that Mark Brown has actually arrived

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Speaker 3: in China today, is going to attend the closing so

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Speaker 3: Manyviation Games and then he is going to meet with

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Speaker 3: Premier Lee Chang.

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Speaker 2: So.

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Speaker 3: The Foreign Ministry said today that this was a routine

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Speaker 3: visit designed to develop cooperation between the two nations, which

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Speaker 3: is what China says well every time, and it says

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Speaker 3: these arrangements are not these are not there to exclude

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Speaker 3: anyone else. They're purely about bilateral relations. But of course

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Speaker 3: we know that China loves prodding countries like New Zealand,

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Speaker 3: who are seen as allies at the US in the

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Speaker 3: Ribs over things like this, and jumps at any opportunity

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Speaker 3: to develop relationships with countries that have traditionally had relationships elsewhere,

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Speaker 3: like the Cook Islands. It happened with Peru, for example.

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Speaker 3: China's just opened the deep water port there so that

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Speaker 3: it can move shipped directly from Peru to China without

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Speaker 3: having to go through America. So it does have a

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Speaker 3: habit of doing these things, and it also likes to

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Speaker 3: present countries like the Cook Islands and other countries in

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Speaker 3: the Global South in emerging markets that there are alternatives

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Speaker 3: to relationships with countries like New Zealand, Australia, the US,

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Speaker 3: and one of them is with China, and China can

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Speaker 3: be an attractive partner for these countries. So China will

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Speaker 3: be fully aware of the history of the relationship with

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Speaker 3: New Zealand, and it will be fully aware of how

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Speaker 3: sensitive it is. I suppose the surprising thing about this

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Speaker 3: is that the Cook Islands didn't say anything to the

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Speaker 3: New Zealand governments about what it's agreed, and we're still

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Speaker 3: not totally sure what has been agreed with China.

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Speaker 2: Maybe we'll find out this week.

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Speaker 1: Well we should all hope. So, but here's the thing.

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Speaker 1: Matt Brown from the Cook Islands has been talking about sovereignty,

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Speaker 1: about cutting the apron strings with New Zealand. So you know,

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Speaker 1: this is an offer that's right there. But you say

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Speaker 1: that about China building a deep water port in Peru,

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Speaker 1: they also build a deep water port in Sri Lanka

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Speaker 1: and the problem is they kept some ownership there when

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Speaker 1: that we're bus they bought it up and that's nearest debit,

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Speaker 1: a military base right there beside India. So that's the

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Speaker 1: concern that we have here that you know, it's trojan horses, yep.

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Speaker 3: And it's a valid because this is how China operates.

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Speaker 3: It starts off as as a sort of fairly loose

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Speaker 3: arrangement or engagement, and then it starts to deepen over time,

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Speaker 3: and before you know it, China's talking about opening a

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Speaker 3: port in the Cook Islands which then turns into a

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Speaker 3: military base. This is exactly the process that has happened elsewhere.

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Speaker 1: And then America wakes up and goes, how the hell

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Speaker 1: did you let that happen? And we went, well, where

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Speaker 1: were you, buddy?

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Speaker 2: So you know, and exactly.

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Speaker 1: Speaking of which, Donald Trump is obviously somewhat isolationists, and

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Speaker 1: he's looking inwards now. And now we've got the reciprocal tariffs.

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Speaker 1: So how is Asia reacting to those reciprocal tariffs that

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Speaker 1: the prison has announced earlier?

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Speaker 2: Well, with some trepidation.

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Speaker 3: There's a wide range of tariffs across Asia, maybe, and

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Speaker 3: this saying that two of the countries that could be

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Speaker 3: hit the most India and Thailand, because they have a

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Speaker 3: wide range of tariffs. I mean, India has on average

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Speaker 3: about thirty three percent tariffs on goods from abroad, has

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Speaker 3: one hundred percent on some goods like motorcycles. And as

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Speaker 3: it happens, Indian Prime Minister Neuendra Mody is in Washington

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Speaker 3: right now, has met with Donald Trump today to try

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Speaker 3: and mitigate the impact of this. But Donald Trump is

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Speaker 3: adamant even if you're a friend that he said today

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Speaker 3: sometimes our friends are our worst enemies when it comes

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Speaker 3: to trade. He is going to put these reciprocal tariffs

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Speaker 3: on India. Even though he was saying he loves India,

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Speaker 3: He's got a great relationship with Neurendra Mody.

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Speaker 2: This is the way it's going to work. Now.

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Speaker 3: One of the fears is that, let's suppose you're Japan

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Speaker 3: or many goods there. They have zero tariffs, and in fact,

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Speaker 3: tariffs are very very low in places like Japan, like Singapore.

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Speaker 3: But Trump is talking about not just assessing a country's tariffs,

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Speaker 3: but what he says are non tariff trade barriers. So

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Speaker 3: he's talking about things like, for example, VAT. Now VAT

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Speaker 3: is not a tariff, it's not a trade impediment. It's

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Speaker 3: basically a on the consumer the tariff. You know, disadvantages

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Speaker 3: are foreign exported to the country over a domestic one.

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Speaker 3: But everyone pays VAT. It doesn't matter whether you are

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Speaker 3: foreign or whether you build the product in that country.

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Speaker 3: You have to pay it. But if it's going to

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Speaker 3: start looking at things like VAT and non tarist impediment,

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Speaker 3: then it means that it's very very uncertain as to

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Speaker 3: what the rates are going to be that could work

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Speaker 3: very widely between countries, and they're going to be very subjective.

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Speaker 3: So this is not a way in which you can

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Speaker 3: really develop global trade or bilateral trade. Between two countries.

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Speaker 3: Companies won't want to invest where there's that sort of uncertainty.

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Speaker 1: No, And of course the people who pay the VAT

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Speaker 1: and pay the tariffs are in fact the American consumer.

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Speaker 1: And then that adds into inflation, and of course inflation

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Speaker 1: is already ticking up in America. And so it's all

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Speaker 1: kind of bad. But as Donald Trump says, you know,

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Speaker 1: we're going to go for some pain, and you said that,

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Speaker 1: and that what the pain is there, it's been measured

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Speaker 1: as well.

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