N.Z. wins agreement in protectionism fight

Press, 21 April 1986, Page 2

N.Z. wins agreement in protectionism fight

NZPA staff correspondent Paris

New Zealand, for the first time, has won agreement from the Western world’s leading Finance Ministers that the tide of agricultural protectionism must be turned back. The Ministers from the 24 members of the Organisation for Economic Cooperation and Development decided at their annual meeting in Paris at the week-end that agricultural trade problems must be tackled.-

They agreed the O.E.C.D. secretariat should make detailed study of the costs of protectionism and urged a September start for talks in the Geneva-based General Agreement on Tariffs and Trade, the body which governs international trade.

Agriculture must be part of those talks, they said. The Associate Minister of Finance, Mr Prebble, who attended the meeting, said the decisions outlined in a mutually agreed communique left him absolutely delighted.

“This is the first time that the Ministers have agreed to study agricultural protectionism and the first time they have agreed measures must be

taken to correct the situation.

“From the point of view of agricultural exporting countries such as New Zealand, these are very important decisions,” Mr Prebble said.

“It is something we have wanted to achieve for the 20 years we have belonged to the 0.E.C.D.,” Mr Prebble said.

“I am not saying we have won the war — far from it, there is still a very tough time ahead — but we have certainly taken a long step forward.”

It was a step which did not come easily, Mr Prebble said. “It took some hours of discussion to get there. “New Zealand took a very vigorous stand on these matters and was, I think, able to do so with some credibility because when we urge reductions in subsidies and tariffs the other countries know we are not asking them to do anything we have not ourselves' done.” Mr Prebble said he believed the change in attitude of other countries stemmed from a “growing understanding that the world economy cannot continue the way it is going. “The budgetary cost

alone of the agriculture policies of the United States, Japan and Europe is billions of dollars a year. They are producing surpluses of thousands of tonnes. .. and these in turn are resulting in rock-bottom prices,” he said.

“I also think the United States and the E.E.C. realise that unless we take significant steps soon there could be a trade war — a trade war in which there would be no winners —- and the cost to the world would be absolutely devastating.”

Mr Prebble said the timing of the O.E.C.D. meeting could not have been better with a G.A.T.T. round on the horizon. The G.A.T.T. talks would begin with Finance Ministers having agreed a policy direction and preliminary O.E.C.D. reports on the costs of agriculture policies — which Mr Prebble was certain would reinforce New Zealand’s arguments — would

be available. Asked whether the O.E.C.D. Ministers’; decisions guaranteed that action would be taken to liberalise agricultural trade, Mr Prebble said: “Put it this way: (unless Finance Ministers say it they certainly are not going to do it, and in the past they have refused to make these statements.

“I am not saying that countries are going, to reduce their protectionist policies tomorrow and indeed we will have some very tough negotiations ahead of us. But we have agreed in principle and this agreement has'never been gained before. “A lot of things could go Wrong but you have to start with the first step.” Mr Prebble said the next step for New Zealand was to put forward suggestions to the O.E.C.D. on how its study of agricultural policies should be conducted. Attention would then turn to the G.A.T.T. talks, he said.