FOREIGN TRADE.

Auckland Star, Volume LXV, Issue 162, 11 July 1934, Page 9

FOREIGN TRADE.

MARKET EXTENSION.

NEED FOR VIGOROUS POLICY.

THE JAPANESE FACTOR,

Discussing the important question of the maintenance and extension of markets abroad, in introducing the proposed tariff alterations, Mr. Coatcs said: —

"As I have already indicated, the use of the tariff for the purpose of maintaining and extending markets for our products is one of great importance at the present time. Great changes have taken placo in international trade during the last few years. Before the depression tariffs were the chief means by which countries regulated their imports. Now, however, control is exercised by means of quotas, embargoes, licensing systems, exchange controls, and other devices, as well as by tariffs. Tins is duo to the development of intense nationalism, which is a feature of the policies of some of the principal nations of the world. Some countries, especially debtor countries, finding it almost impossible to get their goods over the high tariffs walls in other countries folt forced, by way of reprisal and in an effort to reduce their consequent unfavourable trade balances, to impose higher duties on imports, or, where these were ineffective, to resort to the more drastic methods already mentioned. The tendency towards self-sufficiency is particularly evident with respect to agriculture in certain European countries. "It seems that to maintain and develop her overseas markets this Dominion must give serious consideration to its position. Whether or not the new policy is theoretically sound is of minor importance. As many of the great trading nations of the world have embarked on this system, there appears to be no alternative but that New Zealand, to preserve and extend her external trade, should mould her policy accordingly. Tariff Reciprocities. "In my view New Zealand should make a strong effort to enter into negotiations with other countries, especially the highly industrialised countries which offer possibilities for the disposal of our primary products. To do this we should be prepared, subject to the Ottawa agreement, to reduce foreign tariffs, or to adopt quotas or other regulative devices in return for concessions for our products. It is admitted, of course, that the carrying out of such t% policy cannot be achieved in a short time. Kegotiations of this nature are necessarily difficult and involved, but in view of the outlook for some of ojjr primary products (particularly dairy products) it is essential that the matter should be dealt with immediately. It is therefore proposed to pursue the policy indicated above. As honourable members are aware an arrangement was made last year with the Government of Belgium under which concessions on certain of our primary products were made by that country in return for reductions in the New Zealand tariff. "In this connection it must be remembered that under article 10 of the Ottawa agreement New- Zealand has undertaken to preserve the existing margin of preference on United Kingdom pi-ofluets where the margin does not exceed 20 per cent ad valorem (or its equivalent)- and where the margin exceeds that figure not to reduce it below 20 per cent without the consent of His Majesty's Government. Japanese Goods. "Where reductions have been proposed in the British preferential tariff the Government do not, generally speaking, intend, except for some special reason, to reduce the general or foreign tariff below the rates at present levied, so that they may be in a position to pursue negotiations with foreign countries along the lines indicated above. "Another matter that will require consideration is the most favoured nation trade arrangements with foreign countries to which New Zealand is a party. These arrangements have recently been subjected to a certain amount of criticism, and it may, in the light of the altered trading policies of other countries, be necessary to review the position in so far as these trade arrangements are concerned. "In this connection reference should be made to the importation of Japanese goods into New Zealand, and the steps that are being taken in the United Kingdom and elsewhere to deal with this matter. The view of the New Zealand Government is that the problem is one which is most suitable for negotiation _ between the two Governments. An important matter for consideration here is article 12 of the Ottawa agreement under which any preferences granted to the products of the United Kingdom are automatically granted to the non-self-governing colonies, protectorates and certain mandated territories."