The Press TUESDAY, MARCH 14, 1967. What The Trade Pact Cannot Do

Press, Volume CVI, Issue 31318, 14 March 1967, Page 16

The Press TUESDAY, MARCH 14, 1967. What The Trade Pact Cannot Do

New Zealand’s payments to Australia in 1965-66 for goods and services totalled £5B million more than Australia’s payments to New Zealand. In the same year New Zealand’s current account deficit with all countries was £54 million. It does not follow from this that New Zealand’s deficit was “caused” by Australia, or that New Zealand could or should correct its balance of payments by aiming to balance its trade with Australia. Nor should it be inferred that the New Zealand-Australia Free Trade Agreement has failed and should be cancelled. Yet some of the recent public statements on this side of the Tasman rely on this sort of non sequitur. Thus Mr G. E. Stock, president of the Associated Chambers of Commerce: "This, of course, is the “ usual pattern, with Australia wielding the big stick. “The history of trading between the two countries “has always been one of unbalance and acrimony, “with New Zealand trying to battle to a position “ of reasonable equality in her trade exchanges with “ the Australian Commonwealth but always encount-

“ ering barriers, opposition, discouragement, use of “quarantine regulations and the like, to undermine “imports from our country”. Or Dr. W. B. Sutch, at a Rotary luncheon in Rotorua: “ If we could offer “even £4O million of our trade gap with Australia “ to countries which are prepared to take our primary “ products, we [might] have ensured our living “ standards now and in the future ”. Or Mr R. G. Buckleton, of Bulls, in a letter to the editor of the “Dominion”: “There is only one way to negotiate “ with Australians, and that is with knuckle-dusters “ on both fists and steel toes on one’s boots. Federated “ Farmers must again make quite clear to the Gov- “ ernment that they will no longer tolerate the “ bullying tactics of our Tasman neighbour ”, In 1965-66 New Zealand sold £65 million worth of exports to European Economic Community countries, and bought only £l7 million worth from them—almost exactly the reverse of our trade with Australia. Would Mr Stock suggest the E.E.C. should compel New Zealand to eliminate this discrepancy? Would Dr. Sutch advise the E.E.C. to offer £4O million of its debit balance with New Zealand to more deserving trade partners? Does Mr Buckleton think the E.E.C. should don its knuckle-dusters and steel toes to negotiate with New Zealand? The special pleadings of these spokesmen should be ignored; New Zealand uses its trade surplus with the E.E.C., in effect, to finance its deficit with Australia. The argument is not affected by the consideration that New Zealand had a record over-all deficit last year; certainly we bought “too much” from Australia—and from all our other trading partners.

The complaint of the Tasman Pulp and Paper Company, that it is being opposed by Australian paper manufacturers in its bid to capture a share of the Australian market for paperboard, is in a different category. Tasman is relying on its interpretation of the Free Trade Agreement to secure access to the Australian market If the Australian Government persuades Australian manufacturers to accept this “intrusion” into their market, it should do much to allay fears on this side of the Tasman of the implications of the agreement. What neither the Australian nor the New Zealand Government can do, however, is to sell paper or any other New Zealand product across the Tasman: that is for New Zealand businessmen to do.