“N.Z. At Critical Phase Of Economic History”

Press, Volume CI, Issue 29791, 6 April 1962, Page 10

“N.Z. At Critical Phase Of Economic History”

“The Press” Special Service

WELLINGTON, April 5.

There would be a continued and increasing demand for the goods New Zealand exported, but the price received was another matter, said Dr. W. B. Sutch, the Secretaiy of Industries and Commerce, this evening. To ensure that the return was adequate New Zealand should react more quickly to overseas changes, and could do more to anticipate the changes, he said.

Dr. Sutch was giving h’s presidential address to the Wellington Geographical Society and chose as the basis a paper on selling New Zealand's exports.

“New Zealand is at a critical phase in its economical history,” he said. “We have developed as a specialised country supplying one main market and we have relied on a continuation of this arrangement for our future development and standard of living. But for some years political and economic changes have taken place with such rapidity that New Zealand is fast becoming an economic anachronism a country which no longer fits into a world where the economic rules have altered.’’ If Britain joined the European Economic Community and whatever comparable outlets achieved for New Zealand, it was evident that within the next decade managed markets would probably be the rule for a substantial sector of New Zealand’s exports Since the end of the Second World War there had been a doubling of the number of countries in the United Nations. This was because former colonial countries had become self-governing so rapidly. These countries would almost all be developing national economies with much more industrialisation and they were all attempting higher living standards. The role played by what used to be called “colonial products” would itself be different in the future because each of the former colonial areas would be more interested in increasing the price and market stability, and hence the market management of their basic exports. "Add to these the State trading countries of the Soviet Union and China and the rest, where the possibilities of future markets are not known but might be

significant, and we see developing a world to which, to say the least of it. New Zealand’s economic mstilutions are poorly adjusted. “New Zealand has throughout its history always had to make adjustments to the fluctuations and inadequacies of its market abroad: and now. over the last quarter of a century, there has emerged another economic problem—the balance of payments,” Dr. Sutch continued. “Balance of payments troubles seem now to be one of the facts of life. To put this in another way, we seem consistently unable to earn enough overseas funds from our exports to pay for all that our people require to meet their demand for goods “All the signs and pressures are in one direction —internally we must produce more of our needs ourselves in order to save overseas funds, and externally we must prevent our overseas funds from falling further and try to expand t em progrc. ively. We are at a turning of the ways where we are forced to change our thinking on export marketing and spend much more of our national energies on saving the living standards of ourselves and succeeding generations “Most people in New Zealand today agree that we should think about much more diversification of farm production, more diversification of the farm products themselves, more diversification of markets and :• great increase in manufactured products for export.” This thinking was no doubt behind the setting up by the Gi vernment of the Trade Promotion "ouncil and b.v the Manufacturers’ Federation of the export action committee. Dr Sutch then described the mechanisms used by New Zealand to sell its main export products, and said they consisted mainly of the procedures of producer boards tor the most important of the

traditional exports, and included the Governments trade commissioner service. In his conclusion, Dr. Sutch said: “We -would do more to study the trends of production and use of the products in which we are interested in the many countries of which we know little at present. We should be ready to take all opportunities, wherever they occur, to market our goods “We should have the flexibility to meet the requirements of new and different markets and this means continuous review of our selling methods. We should always seek new ways to diversify production into new fields. We should took for opportunities to add value to exports by greater process.ng in New Zealand And, above ail. we should always seek to establish our trading and international relationships so that wc have the maximum control of our own economic destiny. ’