Changes could cost jobs

Press, 16 December 1988, Page 17

Changes could cost jobs

PA Auckland Proposed changes to vehicle import duty could cost 10,000 New Zealanders their jobs, industry sources say. Vehicle assembly firms — and other industries which enjoy tariff protection — could be in for a big upheaval if recommendations of the Government’s tariff concession policy committee are adopted. The proposals suggest any manufactured goods with less than 50 per cent local content would not get protection from imported competition. There is no import duty on

locally assembled vehicles. By January 1, 1990', the tariff on imported vehicles will be reduced to 35 per cent. Mitsubishi Motors New Zealand’s managing director, Mr Denford McDonald, said removing tariff protection from the motor industry and component suppliers would mean loss of about 10,000 jobs. Mr McDonald, also president of the Motor Vehicle Manufacturers’ Association, said the original brief for the committee was to rationalise and simplify tariffs. “Instead it has made suggestions that cut right across previously

negotiated industry plans,” he said. “Now we’ve proposals that mean nearly every locally assembled vehicle could be disqualified from protection.” It was not a measure of efficiency for any industry to have 50 per cent local content. At the moment the vehicle assembly industry had between 25 and 40 per cent local content.

“This nation lacks the necessary natural resources other than energy to have a New Zealand-sourced manufacturing industry,” he said. “What we can do well is be efficient at adding value.”