N.Z.'S IMPORT POLICY

Press, Volume XCVI, Issue 28321, 5 July 1957, Page 15

N.Z.'S IMPORT POLICY

Smooth Recovery From 1954-55

The recovery from the circumstances surrounding the rundown of New Zealand’s overseas reserves in 1954-55 has been achieved with remarkably little disturbance to the community at large, states the Australia and New Zealand Bank, Ltd., in its latest quarterly review. Although this is mainly due to the buoyant overseas receipts, the large measure of freedom from import controls has been retained and extended, with few exceptions designed to temper the impact upon local industry. The value of this freedom in providing a wide range of choice to consumers and producers, and in sharpening competition among overseas suppliers, is of vital importance in a relatively small and isolated country. Its importance in contributing to New Zealand’s high standard of living is easily overlooked.

However, in the interest of overall economic policy, and in particular to lighten the burden of restrictive monetary policy on the private sector, an improvement upon last year’s Government cash deficit is required. If such an improvement is to be achieved without recourse to further taxation, it must be found in economies in Government expenditure and in raising further sums through small savings and public loans. New Zealand’s Budget prospects, therefore, must be viewed against a background of the general election to be held In November and strong continuing pressure for public expenditure on developmental works and social services. Higher Incomes and Taxes

Even at the current tax rates, however, says the bank, it seems that substantial increase of revenue would follow from the higher levels of income, notably farm incomes, received in the last financial year. From these incomes, too, more should be available for savings. In these circumstances, and in the generally more stable economic conditions prevailing; the Government appears to be in a strong position in framing its tax proposals. High farm incomes in boosting export receipts, also present additional demand for imports and pressure upon local resources, and add weight to the need for a sound fiscal policy in the current year. To date, however, says the bank, the more stable conditions attained in the last year have, in general, been preserved. Retail prices increased by 2J per cent, in the year ended last March and notified vacancies continued to decline.

Yields on fixed interest securities showed greater stability, and ordinary share prices continued to reach successive record levels. This trend, states the bank, contrasts with the less consistently good company reports, and appears to reflect the higher incomes and greater funds available for investment, restricted availability of new issues, and underlyng confidence in New Zealand’s continuing development.

LONDON WOOL SALES

Prices Ease From May Levels

(N.Z. Press Association —Copyright) LONDON, July 3.

The July series of the London wool sales opened today with good competition for most New Zealand descriptions, although prices were lower. Bidding was free for a few hundred bales of halfbreds from the South Island, prices seldom being more than 2J per cent, down on May levels. A few second-shear clips were also available, prices falling by 5 per cent. Scoured crossbreds were within 24 per cent, of May rates, while slipes were generally per cent, down also. The offering was 12,987 bales, of which 6438 were from the Dominion.

In a joint report, the Committee of London Wool Brokers and the London agency of the New Zealand Wool Commission state that Continental buyers frequently set the pace. The Home trade probably bought as much wool in the aggregate, but showed some reluctance to bid freely. The tone of the market was influenced by uncertainties reported throughout June from Australian sales, but except • for inferior wools or consignments subject to high limits the clearance was reasonably good.

The selection available from New Zealand in the grease comprised 2150 bales, including a few hundred bales of halfbreds from Christchurch. These attracted especially good bidding from the Continent and prices were almost the same as on May 24. They seldom showed a decline of more than 2J per cent. Most of the crossbreds also comprised wools from the South Island. A few second-shear clips were available. Prices for these declined generally by 5 per cent. The scoured offering of 900 bales included a fair selection of crossbreds. This was another section of the market with a good tone, and buyers from the woollen side of the trade bid strongly for most lines. Prices were within 2$ per cent, of late May rates. Equally satisfactory results were obtained for slipes.'Nearly 3400 bales were included, mostly from the March and April pullings. Prices were 2£ per cent, below the May basis and were almost consistently firm under active bidding.

Australian comebacks and crossbreds met the same Continental demand as New Zealand haflbreds, but were up to 71 per cent, cheaper. . There was a decline of 5 per cent, for good style Australian Merinos. The average styles were 7J-10 per cent, cheaper, with short and inferior wools mainly neglected.

Tungsten Cheaper.— The price of tungsten on the London Metals Market fell today. It is now 118 s to 123 s a unit, compared with yesterday’s price of 120 s to 1255. N.Z.P.A., London, July 3.