Call for abolition of import licensing, export incentives

Press, 28 March 1980, Page 8

Call for abolition of import licensing, export incentives

PA Wellington Import licensing and selective export incentives should be abolished oyer the next three to five ■ years to allow New Zealand to trade more com- . petitively on international markets. This is the main recommendation of a Planning ..'Council report on New Zealand’s long-term foreign trade problems. As part of the restructuring, the report said that the economy had to con-

centrate on exports of non-traditional manufacturers . and energy-based commodities to sustain economic growth. . “There may be some prospects for an increase in the volume of traditional rural exports but, unless market access is greatly improved, this growth will not be rapid,” the report said. It said that growth in trade based on grassland farming had not matched growth in other areas of world trade over the last 20 years, but success in diversifying exports was dependent on putting New Zealand production on an internationally competitive footing — a move which is acknowledged would meet some domestic opposition. “The best general strategy 'in our view is to change all import restrictions and export subsidies together, according to a predetermined and preannounced timetable and over a short period of, say, three to five years,” the report said.

“There cannot be an efimport licensing is retained as the main instrument of protection

against import compttition. It is also recommended that the discriminatory system of tariffs and export subsidies be reformed.” The report said that these changes would be feared by many but it predicted' that if the individual policies were carefully designed and co-ordinated the gains should “substantialy outweight the costs.” The study was done last year by Dr Peter Lloyd, a New Zealander who is a research fellow at the Australian National University in Canberra.

He said that New Zealand needed a more open economy and asserted that Government protection of import-competing manufacturers had discouraged the development of nontraditional manufactured exports. The adoption of new technologies and products had also been discouraged, hindering the economy’s ability to adapt to structural change.

International Harvester Company of New Zealand, Ltd, had a “red letter day” yesterday, when the company was presented with the President’s trophy in recognition of its attainment of retail leadership in unit tractor sales in 1979. The trophy was accepted on behalf of the staff by I.H. N . Z . managing director (Mr A. J. Dewar). It was presented by the international president of the I. H. Agricultural ... Equipment Group (Mr B. H. Warren).

Mr Warren, and the international group vicepresident (Mr W. R. Harper), had flown in from Chicago to present the trophy. “Reaching your 1979 objective is a remarkable accomplishment in New Zealand because of the intense competition of dozens of tractor importers,” Mr Warren said. “Your success in 1979 is. . . in part. . . a worldwide success. It helps illustrate the value of the , worldwide concept under which we now

operate; your products are sourced from the United States, Australia, and Great Britain; the series 84 tractors from Great Britiin have been particularly well received.” IH recently re-organised itself into three groups; specialisation within each group in intense, and various countries concentrate their production lines on those products they are best equipped to handle. Planned capital expenditure for 1980 in $4OO million.