N.Z. Trade With Poorer Nations Proposed

Press, Volume CI, Issue 29952, 13 October 1962, Page 17

N.Z. Trade With Poorer Nations Proposed

New Zealand could profitably develop new markets in some of the poorer, developing countries by means of bilateral trading arrangements. This is the conclusion of Mr Peter Elkan of the New Zealand Institute of Economic Research in a recentlypublished paper of the institute. “Bilateral Arrangements in International Payments and Trade."

Mr Elkan says that New Zealand’s food products of animal origin, on which the country relies for mote than half of her export earnings, face strict quantitative import restrictions in almost all countries of the world. The wealthy countries exclude or restrict food imports to protect their own farmers. The poorer, countries exclude or restrict food imports to safeguard their own scarce export earnings so as to use them to buycereals or industrial equipment.

To eliminate her overseas exchange bottleneck. New Zealand will have to develop her economic policy in several ways; change the structure of her economy to produce new types of exports and to replace imports, participate in international commodity agreements and aid programmes, and open up new markets for the traditional food exports, he says. A vigorous policy of new

market development in the poorer, developing countries might be assisted by bilateral agreements. These countries could be provided with additional means of payment in such a form that it could be spent only on imports from New Zealand. Such arrangements are envisaged not as a new framework for existing trade, but as a device to create new trade.

Mr Elkan examines a number of types of bilateral trading arrangements. Two which suit New Zealand's requirements are the “transferable accounts” used by the United Kingdom before 1958. and the methods of the United States “food for peace" scheme, he says.