DOMINION'S AIMS.

Auckland Star, Volume LXIV, Issue 253, 26 October 1933, Page 10

DOMINION'S AIMS.

MORE EVEN BALANCE.

FOSTERING EMPIRE TRADE.

MR. COATES' EXPLANATION.

(By Telegraph.—Press Association.) WELLINGTON, Wednesday. Urgency was accorded the passage of the Customs resolutions and the first reading of the Trade Agreement (NewZealand and Australia) Ratification Bill in the House of Representatives this evening. The Minister of Customs, the Rt. Hon. J. G. Coates, outlined the negotiations and discussions which had resulted in the agreement, now before the House and traced the history of trade relationship between the two countries. He said the balance of trade had always been in. favour of Australia and lie did not consider any agreement' which might be made with the Commonwealth would enable trade to be balanced, because New Zealand was almost wholly dependent upon primary products for exports, whereas Australia had developed its secondary industries to an extent not possible in a country having the population of New Zealand. It was expected, however, that the new agreement would result in a more even .balance between the trade of the two countries. New Zealand's Objects. The chief objects which- the Government had in view - in completing the agreement were:—First, to obtain as favourable tariff treatment as possible for New Zealand products in Australia; secondly, to safeguard the primary and secondary Industries of New Zealand; thirdly, to encourage trade within the Empire by the transfer of trade which is supplied by foreign countries; fourthly, to prevent the diversion of New Zealand's import trade from the United Kingdom to Australia. "There is a marked difference between the tariff policies of the two countries," said Sir. Coates. "Whereas the policy of New Zealand for many years past has been to grant moderate tariff protection to local industries, Australia, on the other hand, hits in recent years at any rate embarked on a policy of high tariff protection. The rates in force in Australia under the-British preferential tariff on many lines of goods of kinds which are manufactured in New Zealand are in many instances so high that unless some concession were obtained, it would bo impossible for our exporters to gain admittance to Commonwealth markets. "In the new agreement, concessions have, wherever possible, been obtained in respect of those classes of goods where there Is a possibility of New Zealand supplying part of the Commonwealth's requirements." The Minister said ho felt sure that when the terms of the agreement were known, it would be admitted that it should prove to the mutual advantage of the two countries. Chance for N.Z. Exporters. "Complaints have been made by producers and manufacturers in New Zealand," he continued, "that owing, to the higher rates of duty generally levied in Australia than in New Zealand on the same classes of goods, Australian traders were ablo to send their products to this country and compete in New Zealand markets, "whereas New Zealand merchants were in effect shut out of the Australian market. The agreement provides a method of overcoming such difficulty by stating that after three months' notice has been given, the Australian Government must reduce the duty on such New Zealand goods entering the Commonwealth to the lower duty in force in this Dominion on Australian goods. "If this course is not followed, the New Zealand Government has the right to increase the rate on the Australian goods to that in force in the Commonwealth on our goods. The prevision is, of course, reciprocal. It is considered that this provision, together with that relating to the basis of preference, to which I will refer later, will, as far as possible, place producers and manufacturers in both countries on an even competitive basis. Primage and Sales Tax. "Australia lias agreed to exempt New Zealand goods from primage duty. For | some time past "many of our products, whether free of duty or liable to duty, entering Australia under the old agreement, have been subject to a primage duty of 10 per cent ad valorem. It will be understood that the removal of this primage duty should result in considerable benefit to our exporters and in an increased market for New Zealand products. On our part, we have agreed to abolish the primage duty now payable on certain Australian products as soon as financial conditions will permit of this being done. "Sales tax is payable on many classes of New Zealand goods when imported into or sold in the Commonwealth, whereas similar goods of Australian origin are exempt from that tax. This has placed those of our goods which are affected, for example, fish, at a disadvantage in the Australian market. The agreement provides that New Zealand goods exported to the Commonwealth shall not be subject to sales tax if similar Australian goods arc not liable to that tax. This provision is also reciprocal, but as the New Zealand Sales Tax Act is at present applicable both to locally-produced and imported goods of the same classes, no alteration is required in our law. "The effect of the provisions relating to primage duty and sales tax is that in many classes of our goods a reduction will be made of at least 15 per cent ad valorem in duty and/or tax chargeable in Australia. In the cqse of goods which are exempt from ordinary duty, for example, timber, fish, hides and skins and agricultural seeds, which bora one or other or both of these taxes, the effect will bo to make them actually free of duty and sales tax. Rates Higher Than British. "To protect New Zealand industries, the duties on many classes of Australian goods have been fixed at rates higher than those in force on similar United Kingdom goods. The principal commodities affected are potatoes, fresh cherries, canned fruits, jams, soap, sugar of milk, rennet, woollen rugs, woollen blankets, woollen textiles, footwear of other than rubber, leather manufactures, earthen roofing tiles, galvanised iron manufactures, tinware, gas heating and cooking appliances, certain kinds of machinery, and metal manufactures, and corn j millet brooms. j "For many years our manufacturers! . have been at a disadvantage compared I i with Australian maufaeturers on account

of the difference in preference conditions t ill force in the two countries. With reI spect to goods partially manufactured lin New Zealand, Australia hitherto granted preference, provided that 75 per, cent of the factory or works cost was represented by expenditure in New Zealand material and/or labour. On the other hand, in similar circumstances, New Zealand granted tariff preference on Australian goods provided that the expenditure in material and/or labour within the Empire was not less than 50 per cent of the factory cost of the goods. "Under the agreement, the basis of preference will be practically the same in both countries, and it is provided that goods which are partially manufactured in Australia or New Zealand shall not be regarded as the produce or manufacture of the Commonwealth or Dominion unless the • expenditure in material produced in either country and the labour performed vyithin either country represents not less than onehalf of the factory or works cost of the goods in their finished state. Outlining'the details of the agreement, the Minister said it provided that neither country should, except by mutual arrangement, or until after six months' notice, increase the duties on the goods mentioned in the schedule. The right was reserved for either country to impose new duties upon any goods for the protection of new industries established or proposed to bo established, or to collect or impose dumping duties or analagous special duties to meet abnormal trading conditions. It also provided that no special rebate or bounty should be granted by either country in respect to sugar contained in any goods exported to other countries if the result of such rebate or bounty was to reduce the price of refined sugar below the import parity of similar types of sugar.

DRIED FRUITS.

CONCESSION TO AUSTRALIA.

(By Telegraph.—Parliamentary Reporter.)

WELLINGTON, this day.

The imposition of a duty of one penny per pound on foreign sultanas and lexias imported into New Zealand, designed, to secure the whole of the market to fruit of this class from Empire sources, is provided for in the New ZealandAustralian trade treaty. In return for the concession, the Australian Government has given an undertaking that its industry will not take advantage of the tariff or increase the prices of supplies to New Zealand purchasers. New Zealand is given the right to remove the duty if the i undertaking is not adhered to, or- if the Australian industry refrains from supplying all reasonable requirements. * On and after January 1 next Australian produced dried tree fruits are to be admitted to New Zealand at a tariff not exceeding the rate then in force on similar products from other countries. At present Australian dried peaches and dried apricots are admitted under a duty of 2d per lb, whereas similar goods from South Africa pay no duty, although they have to carry the priniage impost. Seeded Raisins. In a separate memorandum dealing with the imposition of a duty of Id per xb on imported seeded raisins, Mr. Coates set out the understanding that the duty will be maintained for at least twelve months, after which New Zealand may remove it, if it is not satisfied that seeded raisins supplied by Australia meet the reasonable requirements of the New Zealand market.

CONFECTIONERY.

SAME BATE AS BRITISH. '>

(By Telegraph.—Parliamentary Reporter.) ■> WELLINGTON, this day.'' ij Reduction frort 30 per cent to 27i ' per cent in the duty on Australian ' imported confectionery is provided for ** in the Australia-New Zealand trade < treaty. Under the present tariff, confectionery of United Kingdom origin is'! dutiable at the rate of 27J per cent 'i whereas the rate on similar goods Under the British preferential tariff is 30 per ' cent. New Zealand has agreed to grant '' Australian confectionery the same rate as is applicable to United Kingdom ' goods, and the Customs Bill, introduced;! into the House last night, contains a provision that in the event of the impost f on United Kingdom confectionery beinc ' lowered, there is to be a corresponding ? reduction in the duty on Australian ' confectionery. j