Tariff agreement reached—Minister

Press, 10 November 1983, Page 1

Tariff agreement reached—Minister

PA Wellington v The Government and manufacturers had agreed on a “gradual and predictable” move to usfe the customs tariff as the primary means of industry protection, said the Minister of Trade and Industry, Mr Templeton, yesterday. Eventually this would replace import licensing, he told the Manufacturers’ Federation convention in Wellington. However, Mr Templeton gave no details of how and when the tariff system would be introduced, mentioning only increased tendering for import licences designed to increase competition among manufacturers for products and enhance efficiency through substitution of local manufacture with imports. Tendering for. import licences would be introduced at the rate of 5 per cent of the domestic market in the first year, rising about 2.5 per cent in the following years, he said. At that rate manufacturers expected it to take more’ than 30 years to phase out import licensing as a protection mechanism.

Export incentives must be phased out between 1985 and 1987 to satisfy New Zealand’s obligations under the Closer Economic Relations agreement and the General Agreement on Tariffs and Trade. Federated Farmers’ president, Mr W. R. Storey, said that Government future policy towards import protection and export incentives was only a “timid step forward.” “New Zealand needs a far bolder approach to develop in a more internationally competitive manufacturing sector,” he said yesterday.

The Government had not provided a specific time- ; table for change and this contradicted one of the Government’s stated objectives of providing certainty in new manufacturing development. .

Mr Storey said the cautious approach to lowering manufacturers’ protection put farmers in the position of being forced to seek compensation against costs imposed by protected industry. . “This would inevitably mean a huge increase in supplementary minimum prices which in the long run

would be a drain on the taxpayers and could

threaten retaliatory action against New Zealand’s agricultural exports,” he said. The Minister of Overseas Trade, Mr Cooper, told manufacturers yesterday that the Government would ask international trading partners to accept a gradual phasing-out of export incentives over a period of years.