Manufacturers’ President Replies To “The Press”

Press, Volume XCIX, Issue 29269, 29 July 1960, Page 15

Manufacturers’ President Replies To “The Press”

“The leading article in ‘The Press’ appears to be based on several inaccurate assumptions,” said the president of the Canterbury Manufacturers’ Association (Mr J. K. Dobson) commenting on yesterday’s leading article on protection by tariff.

“The first of these is that import licensing means ‘prohibition of competition.’ This is not the case, nor is it the kind of import licensing system envisaged by most manufacturers. There have been times when, because of a shortage of overseas exchange, New Zealand has not had the funds to allow imports of manufactured goods. At such times licences for raw materials for industry have also been short. However, when the overseas exchange position has eased there have been relaxations in the issuing of licences, under both Labour and National governments, when imports have been permitted of a wide range of manufactured goods in direct competition with New Zealand products. “The second misconception is over what would be ‘special circumstances,’ under which import licensing should be as referred to by the Minister of Finance (Mr Nordmeyer) at the industrial development conference. ‘Special circumstances’ would not be principally dumping as assumed in the leading article. “There are already anti-dump-ing provisions in the legislation and, while they may not be perfect, they are reasonably adequate. So ’special circumstances’ must mean something else. They would include cases where New Zealand’s commitments under international trade agreements make it impossible to establish an adequate safeguard by tariff, and would also include cases where our standard of living in New Zealand is so much higher than that of other countries that protection could not be given without fixing unusually high levels of duty, which might then operate to the disadvantage of other countries, such as the United Kingdom, United States of America and Australia. Japanese Goods

“This brings us to the third point, the leading article’s statement that the ability of the Japanese to make excellent television receivers cheaply should not be viewed as ‘special circumstances,' justifying their exclusion from the New Zealand market. This would also apply to many items apart from television receivers. “The fact that Japanese workers receive a wage, which is only a fraction of that paid to workers in New Zealand, need not be justification for total exclusion

of goods produced under those conditions, but it certainly is justification for setting a tariff that will fully compensate for the difference in production costs or, if that cannot be done for any reason, it is justificatio.'. for regulation of imports by licensing. “If we do not accept that proposition we might as well throw overboard our New Zealand standard of living and get down nearer to the level of the standard of the Japanese worker,” Mr Dobson said. “The fourth inaccuracy is the statement that the primary industries are New Zealand’s most efficient industries and, by implication, manufacturing industries are the least efficient. “‘Efficient’ is a term that cannot be precisely defined, but most manufacturing industries are as efficiently conducted as most farms and some inefficiencies will be found in both grovjis. Given the same recognition and assistance as the primary producers receive, manufacturing industries would become more efficient still,’ ’ said Mr Dobson.