TRADE MISSION POLICY OUTLINED

Press, Volume XCV, Issue 28231, 20 March 1957, Page 14

TRADE MISSION POLICY OUTLINED

(New Zealand Press Association) WELLINGTON, March 19. A positive plan to achieve closer trading relations within the Comrfionwealth, to protect and strengthen the pound sterling, and to attack the provisions of the Ottawa Agreement as they apply at present was stated today by the Minister of Agriculture (Mr K. J. Holyoake) and the chairman of the Meat Producers’ Board (Mr J. D. Ormond) ( to be part of the policy of the New Zealand trade mission to Britain.

Both Mr Holyoake and Mr Ormond were speaking at the mid-yearly meeting of the electoral committee of the Meat Producers’ Board.

The New Zealand trade mission had a straightforward question to ask—was the Commonwealth supplier or the foreign supplier to take the market? said Mr Ormond.

The mission would want to know whether the Ottawa principle of Commonwealth economic preference would be discarded or preserved and translated into terms of current international trade as far as New Zealand was concerned. In today’s conditions there was more need than ever to protect and strengthen sterling by trading policies within the Commonwealth, he said. Not many years ago the Commonwealth Prime Ministers were called to devise policies to protect sterling. New Zealand did its part and continued to do so. “Need for Positive Plan” "Today, the nations of Europe see a need to stand more closely together in trading relationships,” said Mr Ormond. "Still more so, the Commonwealth countries have need to do the same thing among themselves. We need a positive plan to achieve just that. “If Britain insists on importing from foreign coun tries to the detriment of our trade, then we may, in turn, be forced to look increasingly elsewhere than Britain for our export and import trades. We prefer not to be driven that way.” Mr Ormond quoted Lord Balfour as telling the National Union of Manufacturers in Britain that the British Government should take the lead in “a terrific new Empire effort.” He had noted that half of Britain’s trade was with the Commonwealth. A day or two ago Sir George Nelson, a leading British industrialist. said that “if the integration of trading in the Commonwealth was broken up, its various countries would probably become absorbed in one or other of the world blocs.* - “That is what we fear and what we want to avoid,” said Mr Ormond. "We realise we cannot live apart from the world as a sterling group, but we need to be a whole lot stronger as a group if we are to maintain our position in world trade. N.Z. Car Imports

"Only yesterday we learned of a decision of our own Government which is a grand gesture toward this purpose. New Zealand will increase its imports of cars from Britain to help the depressed British car industry. New Zealand has agreed to do this at the request of the British Government.

“May we now expect that Britain will see our point about our primary produce in the British markets?”

Discussing world markets, Mr Ormond said that never before had such quantity or such a proportion of total meat production gone to “other markets” as went last year. Alternative markets to Britain were not all stable markets. In some of the larger ones, political considerations rather than supply governed purchases. Britain remained New Zealand's only large market for meat exports and, upon its place in that market the Dominion chiefly depended for its living as a meat producer. “We are able to claim that we have been and are Britain’s most reliable and substantial supplier of meat,” said Mr Ormond. “We maintain higher standards of quality and grading than our competitors, and we have shaped our whole system of production, from breeding on the farm to handling through the works and through the markets, to meet British requirements.” Mr Ormond said that the Prime Minister (Mr Holland? had recognised the supreme importance of the trade negotiations. They affected the capacity of the major primary industries to earn the sterling on which everyone in New Zealand so greatly depended for his living, with that fact in mind, said Mr Ormond, the Prime Minister had opened the way to the trade talks and made Mr Holyoake available to lead the mission. Mr Holyoake’s Views Mr Holyoake said that the allimportant question was what prices New Zealand was to receive for its exports. This very largely meant what prices New Zealand would receive in the United Kingdom market for dairy produce and meat. “I think that the trade mission will take every opportunity of reminding the United Kingdom Government that it is not so many years ago that Britain was exhorting us to increase supplies of meat, particularly beef, and dairy produce to the United Kingdom,” he said. “Our main line of attack will be a frontal one on the provisions of the Ottawa Agreement itself, rather on the way those provisions apply today. You will be aware that the object of Ottawa was the establishment of a system of mutual aid. New Zealand was to receive an expanding share of the United Kingdom market at remunerative prices, and in return we agreed to give United Kingdom goods substantial preferences here in New Zealand. Effect On Costs

“These preferences add to the cost structure of both primary and secondary industries, and therefore affect our whole economy. They also limit our capacity to develop export markets in some foreign countries. "The trade mission is taking <T th flgures w hich show that if foreign countries regain their Fr I ?’* W ? r^ ev *, 1 of supplies to the Unit *d Kingdom market it is imk. KJ?!?®.* 01, thesc supplies to be absorbed at reasonable prices: that

is, at prices remunerative to the New Zealand and Australian producers. Our main fear at the moment, however, is the likely effect on our principal export—lamb—if failure to restrict imports of foreign beef results in a market collapse,” Mr Holyoake said.

One of the major difficulties facing the mission would be the extensive subsidy scheme supporting British agriculture, he said. The net farming income in Britain in 1956-57 of £32om was not a great deal more than the cost of the subsidies which gave some indication of the hopelessly uneconomic nature of a good deal of the United Kingdom agriculture. International Pacts Another important difficulty which the trade mission would have to face was the extent of Britain’s international obligations. In addition to G.A.T.T., under which Britain agreed to replace quotas by tariffs as soon as practicable, she had an agreement with the Argentine, dating from 1936, which might limit her freedom to manoeuvre, he said. There had been various disquieting reports about the European Customs Union and the proposed European free trade area, as they could affect agricultural products, Mr Holyoake said. In London the trade mission would be able to keep a close watch on developments. Both Mr Holyoake and Mr Ormond emphasised that it was the intention of the mission to strengthen ties with Britain, not to break them.

IMPORTANCE OF MISSION

Reply To Criticism

Of Size

(New Zealand Press Association) WELLINGTON, March 19.

The policy of having all directlyaffected producing and trading groups represented in the New Zealand trade mission had led to a large delegation, the size of which had been criticised by some persons, said the chairman of the New Zealand Meat Producers’ Board (Mr J. D. Ormond) today. Mr Ormond was speaking at the mid-yearly meeting of the electoral committee of the board.

“But there is a lot at stake for New Zealand in this mission, and it should now be apparent to the British Government, as well as to New Zealanders, that we regard these talks as of major importance, affecting not only the trade in meat or butter, but the whole national economy,” Mr Ormond said.