IMPORTS OF RAW MATERIALS CUT

Press, Volume CVI, Issue 31319, 15 March 1967, Page 1

IMPORTS OF RAW MATERIALS CUT

Mr Marshall Outlines Schedule Provisions (New Zealand Press Association) AUCKLAND, March 14. Imports of raw material, plant and machinery, and finished goods and components will be reduced “in most cases” in the 1967-68 import licensing schedule. The Minister of Industries and Commerce (Mr Marshall) said tonight that in many cases these imports would be cut by 20 per cent.

“In some cases it will be less, and in a few cases it will be more,” he told guests at a dinner given by the Auckland Chamber of Commerce. Mr Marshall said, however: “Adequate raw materials will be available for export production.”

The Minister added that adequate provision would be made for spare parts, for plant and machinery and for urgent replacements. “B u t additional licence applications will be considered only in very special circumstances,” he said. Little modification has been made to the list of exempt items such as petrol, fertiliser, pharmaceutical drugs, books, tea, coffee, cocoa, and many basic raw materials.

“But as would be expected,” he said, “exemption for further items has not been possible at the present time.” Mr Marshall said that in New Zealand’s current economic circumstances no new entrants could be provided for. “New entrants could only be covered by further reducing the entitlements of established licence holders, which would be Inequitable.” Token Licences The Minister said the token licence scheme had been carefully examined, but would be continued. “It is valuable in our trade relations and also in providing some competition and some comparison of quality and costs,” he said. Expenditure of overseas funds on token licences was relatively small—about a quarter of 1 per cent. Referring to the reduced provision for imported goods and materials, Mr Marshall said that in addition to an expected fall In consumer demand, the reduced provision would be off-set by the “substantial supplies” of manufacturers’ stocks which were higher now than they had ever been. Stocks Higher The value of wholesale stocks as recorded at December 31, 1966, was £113.3 mil-

lion compared with the 1964 figure of £95 million. For retail stocks the equivalent figures were £133 million, compared with £l2O million. The value of stocks of manufacturers’ raw materials increased by 7.8 per cent between December, 1965, and December, 1966, and stocks of manufacturers* finished goods increased over the same period by 14.4 per cent.

Mr Marshall announced that the import licensing incentives to encourage exports were being continued—and added that he hoped to extend the scheme to provide further incentive. Reasons Given Giving the reasons for the imports cuts in the new schedule, the Minister said: “Clearly we have to import less for the simple reason

that we cannot afford to do otherwise. “The measures which the Government has taken to correct the balance-of-payments situation brought about by the unprecedented rise in our growth rate had to be supplemented because of a serious fall in our external earnings caused by the weakness in the wool market,” said the Minister. “This is estimated to result in a reduction of about £4O million in overseas funds in the current importing year.” Wool Sales

Mr Marshall added, however, that all the £4O million was not lost, as wool valued at about £2B million—in store —would gradually be sold. “However,” he said, “the immediate loss of £4O million is a serious complication in the framing of the import licensing schedule and makes it tougher than it would otherwise have to be. “Against this there will be —as a result of Government policy and of lower export earnings—a levelling-off in demand and a deceleration in economic activity and therefore a lower demand for imports,” he said-