Bay of Plenty Times. SATURDAY, SEPTEMBER 24, 1932. TARIFF REVISION.

Bay of Plenty Times, Volume LXI, Issue 10923, 24 September 1932, Page 2

Bay of Plenty Times. SATURDAY, SEPTEMBER 24, 1932. TARIFF REVISION.

Consequent on the agreement reached at Ottawa between the British Government and the New Zealand Government, revision of the tariff becomes imperative, and this important matter is to be dealt with during the session of Parliament which opened on Thursday. According to the Prime Minister it was proposed to open the whole question of the tariff for revision, but nothing that was proposed to be done would he detrimental to local manufacturers. A revision of the tariff necessarily means consideration of the protective policy, and protection indicates trade restriction. If the Ottawa agreement is to be closely observed, and no doubt it will, the policy of protection which has proved to be, more or less, an obstacle to progress in most young countries must be greatly modified. According to the agreement reached at Ottawa the British manufacturer must be placed on a competitive basis with local manufacturer. The latter possesses a natural protection in that he is not called upon to pay freight and other incidental charges which the British manufacturer must face, while on the other hand the latter possesses the facilities for mass production, wider technical knowledge and a full supply of the requisite machin- , ery. The costs of production of the , British manufacturer, for the reasons given above, must always be lower than that of the local manufacturer of corresponding goods. These factors are certain to be taken into consideration when revising the tariff, and even on an equitable basis of Customs duties the British manufacturer will win out on the score of superiority of his product. On the broad grounds of self interest it is never a wise policy for a. primary producing country to foster exotic secondary industries. In all such countries there are what may be termed natural industries which should be encouraged, but industries which require tariff protection. Bounties or subsidies are a menace for they become accumulating liabilities rather than assets. The dole is demoralising to the individual. and it is just as demoralising to an Industry, for after all protec(tion through the Customs is in the j nature of a dole to industry. Fur--1 thermore once an industry is grant--led a measure of protection, it acquires a vested interest in that protection, and the tendency is for the industry to ask for more and not less protection. Again with protec--1 tion once granted it cannot be readily taken away or even modified without, causing a political, as well as a commercial commotion. An illustration of this is afforded by the wheat duties. This protection is doing the country, as well as other industries, a great deal of harm yet politicians are positively afraid to deal with the matter because of the disturbance such interference will create. The Ottawa agreement lea.ves the Government with no option in the matter; the tariff must he revised and revised downwards, and that must prove beneficial to the people, for it envisages a greater freedom of international trade. It could be urged with considerable truth that New Zealand possesses facilities for establishing certain secondary industries. The wool findustry for instance. We produce [ the wool and seems but logical that we should convert the staple into manufactured goods, but where there is no export market the limit of economical production is restricted to the power of the community to absorb, and we are only a handful of people. By “fostering” secondary industries, the primary producer has to pay for goods that cost him a great deal more than if they were imported and this adds to his costs of production and lowers his purchasing power to the detriment of the community. The New Zealand primary producer sells his produce in competitive markets, and he is not making an excessive claim when he demands that he should be free to buy .the goods lie needs in a competitive market and not in a protected market.