Aust. rebuff to N.Z.

Press, 11 April 1978, Page 17

Aust. rebuff to N.Z.

NZPA Sydney One of Sydney’s morning newspaper, the “Sydney Morning Herald,” says in a leading article that the launching of an Australian and New Zealand Businessmen’s Council comes at a “significant, rather than an auspicious, time.”

Quoting the president of the Bank of New South Wales, (Sir Noel Foley), the article said the plain truth was that difficulties appeared to have arisen in the two countries’ trading relationship. It went on to say: “At a time when New Zealand’s economic troubles make it want freer access to Australian markets, Australia’s own problems have not only made it unreceptive to such pleas, but have actually led it to limit New Zealand’s access to certain markets. Naturally, this unhappy position does nothing to diminish the welcome that should be extended to the businessmen’s initiative.”

The article said Sir Noel was confident that many of the problems and difficulties could be based on misunderstandings and wrong assumptions which could be cleared away by open and frank discussions.

“It is to be hoped that, to the extent that he is right, the new council will have early success with its clearing away. But it has to be said that many of the difficulties that stand in the way of increased Tasman trade have far more fundamental causes,”

“Mr Taiboys has been arguing that mutual benefits would flow from combining the two manufacturing sectors into a single marketing base. The advantages would be greater economies of scale and. according to him, greater competitiveness in third markets. Although he does not say it, the plan would have to mean greater specialisation and

rationalisation in each country’s manufacturing industry. Unfortunately, the advantages would flow more to New Zealand than Australia. It is obvious that, in terms of scale economies, New Zealand manufactures would gain more from access to Australian markets than vice versa.

The “Herald” said the most pressing problem facing Australian manufacturers and Australian foreign policy was the need to accommodate the manufactures of A.S.E.A.N., South Korea, and Japan, rather than of New Zealand.

“There may be small gains for Australia in exposing certain of its manufacturing industries to greater competition from New Zealand imports, but if such an initially disruptive step were taken it would surely be preferable to go all the way and let in the much cheaper products from Asia.