Trade penalty not planned by U.S.

Press, 17 December 1986, Page 2

Trade penalty not planned by U.S.

PA Wellington The United States Embassy yesterday moved to distance the Reagan Administration from the call by the United States Navy Secretary, Mr John Lehman, for economic penalties against New Zealand in response to the nuclear warship ban.

Mr Lehman had said removing the trade benefits New Zealand enjoyed would demonstrate that there was a price to be paid for barring United States Navy port visits. But in a statement released in Wellington yesterday afternoon, the United States Ambassador, Mr Paul Cleveland, said there were no plans to impose trade sanctions against New Zealand.

“Statements attributed to the the United States Secretary of the Navy, John Lehman, urging restraints on New Zealand trade with the United States do not represent United States Government policy.”

Mr Cleveland said Mr Lehman’s reported statements represented a “personal view.” “As it has said innumerable times, the Administration has no plans to

invoke punitive economic actions of any kind against New Zealand,” said Mr Cleveland. In an interview with the “Navy Times,” Mr Lehman said it would be better for the United States to "writeoff any forseeable improved relations with New Zealand,” to make it clear to anyone else who was tempted to similar action that doing so would mean reconsideration of favourable economic ties. Mr Lehman wants the United States Administration to reconsider New Zealand’s “most-favoured nation” trade status with the United States, a mutually beneficial agreement that comes through membership of the General Agreement on Tariffs and Trade.

The status gives each side the best trade tariff rates, although in New Zealand’s case the United States has applied countervailing duties to products such as lamb and steel Mr Lehman has been outspoken against New Zealand’s anti-nuclear policy before. In February he described it as “outrageous” and “the height of irresponsibility.”