Aust, bounties ‘may disrupt trade flows’

Press, 18 June 1986, Page 3

Aust, bounties ‘may disrupt trade flows’

By

PA Wellington Australian bounties may disrupt trade flows and

frustrate good will and progress generated by the Closer Economic Relations agreement, said the Minister of Trade and Industry, Mr Caygill, yesterday. “It seems quite bizarre that as New Zealand is reducing its subsidies, Australia is increasing its, in the form of bounties,” he said. The problem was not widespread, being confined to about 20 categories in a range of Australian manufactured products. But the effect was pervasive and addictive to manufacturers, Dr Caygill told the Institute of International Affairs in Wellington. In recent months Australia had extended bounties payments to cover tractors and grain harvesters, and certain agricultural and horticultural machinery for soil preparation. "Clearly they are removing one form of trade barrier for another,” said Mr Caygill. Bounties were clearly inconsistent with the spirit of C.E.R., but were not directly dealt with under the C.E.R. agreement, even though they existed before the agreement was signed, he said.