N.Z. ‘nice to visit but poor for investment’

Press, 8 March 1978, Page 3

N.Z. ‘nice to visit but poor for investment’

NZPA Washington Americans regard New Zealand as a nice place to visit but when it comes to investing money, that is another matter. “Our image here is contradictory,” says Mr Lloyd White, New Zealand’s retiring Ambassador to the United States. “We are thought of as friendly people, democratic, well educated, environmentally aware, living in a great country. But if you are an American in the business or finance world, you have to wonder whether New Zealand has the initiative and capacity for hard work to get on in this world.” Mr White, sneaking in an interview on the eve of his return to New Zealand after almost six years in the Washington post, said Americans did not see New Zealand as a growth area. “They see us as plagued with labor and transport difficulties, taking a long time to get things built and working — in short, as sitting on our bums and lacking the will to expand as we should. “They also regard our tax system as regressive, with its failure to offer tax rewards for success.” Mr White says this means that American individuals and corporations with

money and ideas often study New Zealand and then invest in Europe, South America or Asia. Mr White, himself wonders too, whether New Zealand can gear itself to improve its standard of living and place in the world. He also thinks that changes in the tax laws are imperative if New Zealand is to haul itself out of its balance-of-payments hole. “It seems to me there are great opportunities here to improve our earnings, not only in California where we are concentrating, but elsewhere in the United States. “But there must be better incentives, mainly in the tax field. There are incentives already, but they fall short of what is required.” Mr White offers the Irish Republic as an example of the direction in which New Zealand should move. “Ten years ago Ireland was in much the same position as we are today, but it solved its difficulties by giving a complete tax holiday for new investment in the export sector,” he said. “This was very discriminatory, unfair to existing business, and it was heavily criticised. But it resulted in major domestic and international investment, many new export factories, and thousands of new jobs.”

i The tax break was not fair and equal but it turned Ireland into a nation with a balance-of-payments surplus. Mr White says American firms are willing to help New Zealand but a restructured tax system would help to make it a lot more attractive for them to do so. Unless New Zealand makes radical tax changes, “I cannot see an end to our balance-of-payments difficulties.” Mr White has no plan to buy a grapefruit orchard in the Bay of Plenty or raise flowers in the South Island. He and his wife will live in Lower Hutt. But he has a formal plan for “retirement.” “I don’t want to disappear from the scene. I want to be part of things still,” he said. One day a week Mr White wants to devote to some local project in his community, although at this stage he has no idea what. Another day will go on something in international affairs. “I hope I can make some contribution from all these years in the department. I don’t want to drop it altogether,” Two other days in the week will be given to writing — “nothing serious, no memoirs” — and to helping same firm or organisation in the business world in exports. The other three days he hopes to devote to golf and fishing.