TWO-WAY TRADING WITH GREAT BRITAIN

Dominion, Volume 29, Issue 201, 22 May 1936, Page 8

TWO-WAY TRADING WITH GREAT BRITAIN

Importers Confer With Ministers OUTLINE OF POLICY £40,000,000 Worth Of Produce at Stake Tlie. importance Hie Government attaches to the expansion of two-way trade between the Dominion and Great Britain was made clear by the Primo Minister, Kt. Hon. JI. J. Savage, to a deputation from the United Kingdom Manufacturers and New Zealand Representatives Association which waited on him yesterday to ascertain what was intended as to the future of imports into this dountry, particularly those from Britain. With the Prime Minister were the Minister of Finance ami Customs, Hou. W Nash, and the Minister of Industries and Commerce, Hon. D. G. Sullivan. Mr. Savage gave his assurance that nothing would be done to injure trade relations with the United Kingdom, and emphasised the value of the projected visit to London by Mr. Nash, whose object would be to arrange for the expansion of trade between the two countries. The president of the association, Mr. C. W. Budd, said bis organisation represented a large proportion of British manufacturers trading in this country. Mr. Nash would receive a very cordial welcome from the manufacturers in Britain when lie visited the Old Country. After stating that the importers had read in the newspapers that the Government proposed to interest itself in deciding what goods could be imported, the vice-president, Mr. D. Hogg, said that already merchants were becoming afraid to place orders overseas, as they did not know to what extent their imports would be affected. Seasonal trade had to be arranged at least six months ahead and clarification of the Governments intentions would be appreciated. It was felt that the protection at present afforded local industries was too high, and it was considered that the best check on local costs was a reasonable landing charge on imports, thus providing competition. The tendency of local industries was to base their selling costs on the landed costs of the manufactured products of the United Kingdom. Goodwill Strained. In the past New Zealand had enjoyed the goodwill of the people of Britain and her 'industrialists, but in recent years it had been strained a little because of new factors operating against United Kingdom exports to

this country. Trade was being diverted t<> Australia and to Japan.

"Tliis association favours the d‘’velopinent of secondary industries in New Zealand on sound lines.” continued Mr. Hogg, "but we asl ‘ that the United Kingdom bo given a fair opportunity to’-ieado here. Restriction will jeopardise the disposal of £40,000,000 of New Zealand produce.”

Mr. S. Cory Wright said the association felt that .Mr. Nash would have a big job in selling New Zealand s output in England unless the ships coming out were tilled in the same way as the ships going to Britain. In recent years a considerable volume of goods were purchased from Australia instead of the United Kingdom because of the exchange rate against Britain, together with the extra freight charges. If the Government could give some indication how the importers could assist in extending trade with Britain they would be only too glad to help Task- of .Magnitude.

Mr. 11. S. Hart emphasised the magnitude of the task of disposing of the surplus produce of New Zealand to the best advantage. The importers realised that they had to stand or fall with the general community of New Zealand in the success or failure of the Government’s plans to arrange trading terms with Britain in the future. Mr. Nash, on his mission to the Old Country. would need the assistance of everyone concerned. From a cold business point of view there was no reason why at least 30 per cent, more goods could not be imported from Britain. “We feel that nothing would please I he Government more than to bring about a balanced two-way trade between the Dominion and Britain, after allowance is made for debt service,” .said Mr. Hart. “Wo will welcome an indication of how we can cooperate and also some idea of the Government's intentions as to tariil restrictions in favour of local industries. This is affecting Ike placing of orders, and will continue while the existing uncertainty continues." Replying first, the Hun. IV. Nash pointed out that the Government’s objective was to increase the standard of living of the mass of the people of New Zealand. We had to extend the manufacture of certain commodities that we previously imported. This was the human economy that took account of the young persons for whom work must be provided in the years to come Paying for tiio Goods. The only way, however, in which the Dominion could be paid for her surplus produce was by importing goods in exchange. Once we had satisfied our needs in New Zealand, the more we could send to Britain the better for both countries. As far as was humanly possible the Dominion would take goods from Britain to the extent that Britain took goods from New Zealand, after provision had been made for debt service. If a bilateral agreement could not be arranged with Britain, it meant that New Zealand’s trade with the Old Country must decline. ‘‘l am saying that it is going to ]>o done,” continued tile Minister. "There is no question of wizardry, but I do say that Britain is willing to talk.” He added that negotiations would be conducted With Great Britain before

they were of>eued with any other country. There were certain commitments by the previous Government to Belgium, and that agreement would be honoured. But in future Britain would be first. If Britain did not want any part of our surplus it would be offered to other countries. Reason on Their Side. 'The Hun. D. G. Sullivan expressed appreciation of the recognition by the deputation that New Zealand was entitled to develop her own secondary industries, while at the same time asking for the safeguarding of ’.he trade of the Dominion with Britain. The deputation had just reason for seeking that safeguard, and one only had to look tit the diversion of trade from Britain to Australia to appreciate the need for some form of assistance. "The Government will do its very best, consistent with its duty to the manufacturers of this country and the people generally, to see that Britain receives the share of our imports that she is fully entitled to,” said the Minister. The Prime Minister said everyone would agree that trade with the United Kingdom could and must be extended. It was just a question of how. The question of the importation of goods from the East was the concern not only of New Zealand but of the British Commonwealth as a whole. Some people believed that the problem could be solved by prohibiting the entry of such goods, but it was not as easy as that. Agreements -must bo arranged in a friendly fashion. The time was long overdue when representatives of each nation of the British Commonwealth should sit at a round table with power and authority to act with the common purpose of arranging trade agreements for the benefit of each unit and the Coimnonwealth as a whole. Speaking of the forthcoming visit to Britain of Mr. Nash, the I’rime Minister paid him a high tribute for his 1 practical knowledge of the questions which would confront him, ami his honesty .and sincerity of purpose. It was men like Mr. Nash who were needed at the common table of which he httd spoken. "I have said before that we in New Zealand are prepared to stand or fall with the British people,” continued Mr. Savage. "This menus more than mere words. It means that we are prepared to trade on common-sense lines. In the past we have sent Ministers to Loudon to discuss trade problems, but they were back almost before they had gone away. I do not think it is fair to blame them as incompetent, but they did not have their feet on the ground. While problems remain we should have representatives at work together until they are solved, even though it might mean mouths round the table."

Mr. Savage said that trade could never be extended on the existing foundations. In plain English that meant that only when people were in a. position to buy more would they be able to trade more. The mere transfer of trade from one country to another was not enough; the standard of living of the people generally must 'be raised before goods could move between countries.

He was of opinion that, the British Commonwealth had started the wrung why by investing surplus capital in foreign countries. The result was that

foreign goods had to Im accepted in order that payment might be made. Nothing Complicated. When the representative of New Zealand met those of Britain to discuss trade bo would ask if they were prepared to take more New Zealand produce in exchange for the manufactured goods of Great Britain. He could see nothing complicated in that, proceeded Mr. Savage. When were we J going to restore lost trade? His an- • swer was that it would be restored I when people in high places began to think. New foundations had to be put .in altogether. The Government had I been accused of doing rash things, but I it was doing nothing before it had stopped first to count the cost. The time had gone by for fear. 'What was needed was a bold policy. Mr. Nash’s mission could not begin too soon, but there was much to be done before he could leave New Zealand. "We want io understand the British people, and we want them io ■ understand us,” said the I’riino Minister. “We want them to feel that they can trust us. We want veil to feel that you can trust us. if vou lw>e any doubt about what tiie Government is going to do, the case will be hojteless. lam not talking this morning with the idea of fooling you. but io try to help you." The Prime Minister recalled that his room had been full of the representatives of New Zealand manufacturing industries not long before. They had expressed alarm that trade was going to overseas manufacturers because of the Government’s industrial legislation. To-day the room was full of importers who were afraid that trade was not going overseas. (Laughter.) Mr. Cory Wright: They are held up on both s'ides. ■ The Prime Minister: It might easily | be true both ways. | Mr. Cory Wright: That is the trouble, ' sir. I The Prime Minister: lam told that business is Hying, and that trade has I not. been better for years. Mr. Savage assured the deputation that the Government was as anxious as they were not to injure trade relations with Great Britain, which was New Zealand’s main market. Reduction of Ex'diange Kate. Referring to the exchange rate, the Prime Minister said that it was easy to raise the rate, but another thing to get it down. Tlie sales tax was another impost related to it. Tile Government . believed it could reduce both tho exchange rale and the sales tax if given reasonable time. The moment the exchange rate was mentioned the farmers began to shiver. They thought they were getting something out of it, but lie knew they were not. It was the most senseless thing any Government could have brought in, and was only a levy on the rest of tlie community, (Hear, hear.) In conclusion the Prime Minister said the Government would do nothing detrimental io tlie importers, Io the New Zealand manufacturers, or to the farming community, who all had io live together.