Economists criticised

Press, Volume CXI, Issue 32676, 4 August 1971, Page 18

Economists criticised

New Zealand tended to i concentrate too much on ] problems and not enough bn opportunities, a U.E.B. executive, Mr i G. Dryden, told the Canbury branch of the Eco-' nomic Society in Christchurch last evening. i In his address he criticised New Zealand economists, for repeatedly using the term: “The terms of trade are against us.” He also criticised those economists who\ advised the National Development Conference and he referred to the targets set by the conference as “disgusting.” “Too much of what passes for economic forecasting in New Zealand is, I suggest, little more than the collection of past statistics,” he said. "Too often book-keeping is being mistaken for economic planning.” “Too much attention is being paid to problems and not enough to effective solutions.” Overseas income Mr Dryden predicted that within the next 10 years an important and growing slice of New Zealand’s overseas income would come from products that were not top export earners today. These included, milk shakes or similar milk-based drinks; sausages; all-wool tufted carpets; basic protein in various forms -for addition to other nation’s traditional diets; products manufactured from fat by-products; and sophisticated combination products from basic New Zealand raw materials, particularly eggs, milk powder and fat. To secure a’ worth-while trading future, New Zealand would need to engage in many more joint manufacturing ventures overseas, he said. In such ventures New Zealand would contribute processed and semi-processed I

raw materials, arfd its overseas partners would contribute manufacturing equipment and labour. Together they would contribute marketing knowledge. To show what marketing could achieve, Mr Dryden mentioned the example of milk in comparison with Coca Cola.

Milk potential “New Zealand cows produce an average of four million gallons of milk a day Coca Cola around the world sells approximately four million gallons of flavoured water a day.” New Zealand’s export income from its main dairy products has been averaging .between s2oom and s2som a year. Coca Cola’s annual sales are now well over $10Q0m:

“Brother words, Coca Cola earqs between four and five times as much for selling 1 flavoured water as New Zea-, land farmers earn for ex-' porting one of the richest sources of liquid protein in 1 the world,” he said. “The difference is called marketing.” Mr Dryden considered milk shakes and associated by-products as some of the untapped advantages which New Zealand enjoys.“We do make, I consider, the best milk-shakes in the world—and some of our milkice thick-shake bases are un-i equalled." \ , “We have surplus eggs and other low priced items —such as milk powder and , fat-rthat can be converted ; by. food technologists into products as diverse as instant pavlcvas and egg qog mixes. World’s needs 1 “I- suggest that too many New Zealanders for more than a decade have been coni centrating on the problem of milk rather than the opportunities for m,Uk-based proI ducts in a wdfrld that, over-

all, is rapidly increasing its affluence.”

He said that the future lay in international specialisation, not in manufacturing every possible product in a small country such as New Zealand.

“It always seems tragic to me- that New Zealand, for many years, has engaged in an argument where the alternatives have frequently been wrongly stated. And if youi' options have been wrongly defined, the answers can never be right.” Mr Dryden said he believed that New Zealand’s answer lay in defining what the world wanted; growing or producing farm or other related raw materials to satisfy those needs; processing them to a certain stage and then securing overseas markets by providing customers with profitable reasons why they should stick with New Zealand products. This probably meant joint manufacturing ventures in other countries for final processing, he said.