The Maritime Union says it is “disgusted and angry” the Prime Minister has no plans to raise the aging Interislander “ferry fiasco” during his trip to South Korea this week.
A spokesperson for Christopher Luxon said he would not be meeting with South Korean company Hyundai Mipo Dockyard while abroad and did not consider the cancellation of its shipbuilding contract would feature during his two-day visit to Seoul.
As revealed by RNZ on this morning, New Zealand officials notified their South Korean counterparts of the termination via text message less than an hour before it was to be announced.
That’s despite the Ministry of Foreign Affairs and Trade (MFAT) earlier warning of the risk to New Zealand’s relationship with South Korea and the need for “careful and deliberate communications” with its government.
The cost of exiting the half billion-dollar deal with Hyundai has not yet been announced following months of negotiations, though the Maritime Union estimates the figure could be as high as another $500 million.
The Intrerislander’s aging fleet of ferries has been plagued with issues over the past few years. Kaitaki was built in 1995, while Aratere and Kaiarahi were built in 1998.
The union’s national secretary, Carl Findlay, told RNZ the “reckless decision” had left the country in a state of limbo with no resolution in sight.
Luxon needed to use his “much-vaunted international business experience” during his trip to Seoul to settle the cancellation or renegotiate for new ferries, Findlay said.
“He really needs to go over to Hyundai, cap in hand, and say, ‘Hey, my finance minister made a massive stuff-up’. It’s costing New Zealand taxpayers a lot of money. Let’s resurrect this deal and get something sorted.”
Findlay said he was astounded Luxon did not intend to broach the matter at all given the amount of taxpayers’ money on the line, as well as the country’s reputation.
“This is a billion dollars we’re talking about here, and there’s nothing to show for it, absolutely nothing. I’m disgusted and angry about it all.”
The situation risked souring relations with South Korea, having squashed the biggest economic deal between the two countries in years, Findlay said.
A spokesperson for Luxon said the Prime Minister had no meetings planned with Hyundai Mipo Dockyard during his trip, nor did he expect to raise the project during any other scheduled meetings.
“New Zealand and South Korea have a strong trading relationship and the Prime Minister’s visit alongside a senior business delegation will be exploring opportunities to strengthen that relationship.
“We do not consider the cancellation of i-Rex to have an impact [on either the trip or the wider relationship].”
Luxon was due to meet with South Korean president Yoon Suk Yeol on Wednesday morning.
The government announced the end of the contract with Hyundai Mipo Dockyard in December last year, saying the project’s overall cost had blown out to almost $3 billion.
It had been estimated to cost just $775 million when KiwiRail submitted its business case in 2018.
