Trade talks disappoint, but P.M. hopeful

Press, 15 August 1980, Page 1

Trade talks disappoint, but P.M. hopeful

Parliamentary reporter

Satisfactory progress was being made towards closer economic relations between Australia and New Zealand, but the latest round of N.A.F.T.A. talks had been disappointing, said the Prime Minister (Mr Muldoon) yesterday. “The garment trade across the Tasman has really been torpedoed,” he said at a press conference. The present garment agreement will expire at the end of this month and will not be renewed.

“I heard one of our garment people express what I thought was pleasure at this, but our exports are likely to drop, by more than the Australian exports to New Zealand and I wouldn’t: regard that as a good situation,” Mr Muldoon said.. Australia did not have unlimited access to New Zealand in the garment trade -as had been suggested, he said.

“There were levels of the market put on Australia sending to the New Zealand market and these levels were being adhered to — they hadn’t reached them in some cases.

“But the arrangement that we had would have provided, and indeed did provide, for more New Zealand garments to go to Australia, in value, than came into New Zealand. That has ended,” Mr Muldoon said.

The trade in carpets, which had been a difficult issue, had “come together,” he said. Some talk of dollar-for-dollar trade in some commodities had been raised by the Australians at the talks, Mr Muldoon said.This would be welcomed by New Zealand. At a regional heads of Government meeting in Sydney two years ago, Mr Muldoon told his Australian counterpart (Mr Fraser) that at any time Australia wanted to move to a dollar-for-dollar . . relationship in trade, New Zealand would be ready. “But I don’t think they will. They have always sent more to us than we have sent to them,” he said.

The difficulties which had emerged from the NA.F.T.A. talks showed that difficulties in bringing together an over-all

arrangement for closer economic relationships, with Australia should not be underestimated, Mr Muldoon said. “I am keen that it should happen, but we must not- underestimate those difficulties. These talks have made it clear that there are interests in Australia that will prove to be stumbling blocks in the broader relationships,” he said.

The director-general of the New Zealand Manufacturers’ Federation (Mr lan Douglas) said that New Zealand . manufacturers continued to be cautious in their approach to a new Tasman .relationship, reports NZPA. Speaking ,to the Australian National University seminar on Australian* New Zealand economic, issues, he said the economic position in New Zealand, coupled with the present restructuring in industry, coloured manufacturers’ view.

They were apprehensive of the cumulative impact of that and the steps towards closer economic relations with Australia. Mr David Morton, director of trade and tariffs at the Confederation Australian Industry, said fears that a closer economic relationship could lead to New Zealand industries relocating in Australia were misplaced.

The reverse was more likely to be the case with. Australian industry ' going to New Zealand to take advantage of the lower wage levels — about■55 per cent of those in Australia.

“Taking together the lower wage levels -and lower on-costs, the cost to a company of employing • labour in New Zealand is less than half that in Australia.’’

Mr Morton also emphasised a common view of Australians that a closer trans-Tasman relationship should not be viewed as a closed shop between the countries but should be seen in its international trade significance. “Any closer trans-Tas-man relationship must be an open one, and any policy decisions taken within the framework of a new trans-Tasman agreement should have a keen regard for the multicultural costs and benefits,” he said. TRADE REACTION, Page