Problems admitted in meat-for-oil deal

Press, 21 July 1982, Page 12

Problems admitted in meat-for-oil deal

PA Wellington The Meat Board has admitted that there had been "some misunderstandings” with Iran over its $194 million lamb-for-oil deal signed two months ago.

However, the chairman, Mr Adam Begg, said officials were confident the contract would be fulfilled.

In response to an article in the “National Business Review” which said the deal was at risk because the aboard had started shipments 'to Iran before receivihg'ia letter of credit, Mr Begg made a statement on Monday. evening. He said that Mr Brian Freeman, of Thomas Borthwick's, an exporter’s representative on .the New Zealand team that negotiated the contract, was' in Europe with the board’s Iranian manager, Mr Hasson Shaida, having discussions aimed at overcoming the misunderstandings. “They have indicated to-

day that they , are confident the problems have been resolved and that the contract will be fulfilled,” said Mr Begg. The “N.8.R." story quoted meat industry sources as saying that the board had “made such a hash of the Iran contract that it could never again be seen capable of handling international negotiations on behalf of the entire meat industry.”

.The deal called for New Zealand, to supply about 60,000 tonnes of lamb to Iran in. exchange for oil that would be shipped to a third party on the international market.

is already an estimated $4O million worth of meat on the water and still no letter of credit from the Iranians,” said the “N.8.R.” article. Angry meat supply companies were demanding the sacking of those responsible for negotiating the deal and “heads will roll" after meetings of the Meat Marketing Corporation and

the Joint Meat Council this week.

The “N.8.R.” report claimed that “onerous” clauses which meant that if New Zealand did not supply meat according to the schedule, with or without a letter of credit, it would be in breach of the contract, had been inserted after the negotiations and left Teheran and before it was signed by the. New Zealand Trade Commissioner there.

Mr Begg saidUast evening that the Meat Exporters’ Council' had been fully involved in all decisionmaking relating to/ the contract.

“The negotiating team has always involved exporter representatives and the whole approach to the contract has been on. a joint industry basis.”

He said two exporter and two board representatives were on the team that negotiated the deal “and they were all aware of the terms of the contract.”