Retailers “not to blame” for higher imports

Press, Volume CXV, Issue 33778, 26 February 1975, Page 12

Retailers “not to blame” for higher imports

Retailers and merchants are not to blame for the staggering increase in imports last year, says the New Zealand Retailers* Federation.

To place the level of imports and the composition lof imports in perspective, the federation has analysed the country’s 1974 imports bill, and examined the results. “Apart from the increased price of fuel, which was out-! 'side New Zealand’s control,! |the rise in the total imports; • bill had a number of other; major contributing factors,” the federation says in a i statement. ! “The first of these was the •surge in general demand beginning in late 1972, conitinuing through 1973 and into the first half of 1974.” . “This arose from a series! of wage orders well above 'price rises, and from record! ; export receipts from farm; ; products. “Secondly, there was a! boom in international com;modity prices particularly) ifor metals, fibres and chemi-i ! cals. “Thirdly, manufacturers! ) showed a strong desire to ! ensure sufficient materials supplies for continued production, to the extent that j there was stockpiling in some ) areas. “A fourth factor was reinvestment in plant, a process which had earlier been deferred because of economic uncertainty.”

Local manufacturing “Shortages from local I manufacturers also contributed when special ‘on-off’ imports were allowed under licence to reduce delays in other industries, for example builders’ supplies. “Any increases in consumer goods were of minor ; significance compared with those broader factors which only Governments could • influence.

“The table shows the groups which were the major; contributors to the total' increase in imports. $ million | increase S over 1973 Fuels .. '.. 16.5 107 •Machinery .. 14.2 92 •Metals .. 11.9 77. ■ Textiles .. 11.6 • Chemicals .. 11.6 76 i Transport .. 9.4 61 f 75.2 508 ! AU other goods 24.8 140 ; 100.0 648 “So three-quarters of the increase came from materials) largely used in local manu-; ; facturing. “There is no ready-made ; analysis of imports of consumer goods but by separat- ; ing 35 consumer items includj ing food and beverages, it has been possible to isolate | imports totalling $76 million. Timing important “This represents only 4.1 per cent of our total imports, and the majority of these items were not made locally, for example, outboard motors, watches and clocks, cameras, precious stone and towels. Rice which is not grown

locally is another item in this group. ; “Criticisms of imports of! consumer goods lack per-1 spective, since when the statistics are examined, it! 1 becomes evident that to con-! serve overseas resources ■ materially, it is necessary to! look at the major items in • our import bill— fuel. ) machinery, metals and! 'chemicals. , “A one per cent saving on) these items would be equivalent to a 20 per cent cut ini imports of consumer goods. j “Timing is of critical importance. More imports should have been allowed in ' early 1973. Instead, most orders were placed when the economy was already beginning to slacken. ■ “The result is record stock : levels at all stages of manufacture and distribution, as shown in the accompanying graph. “Overseas orders have fallen, but these ill not ; show until the middle of this ' year. ' “Obviously the country ' must get the most productive ’ use of imports but it is ' wrong to make retailers ar d wholesalers the scapegoats,” the federation concludes.