NO ILL-EFFECT ON IMPORTS

Evening Star, Issue 23128, 30 November 1938, Page 15

NO ILL-EFFECT ON IMPORTS

ANALYSIS BY MINISTER SCOPE FOR GREATER PRODUCTION [Per United Press Association.] WELLINGTON, Nov. 29. “ Industrial expansion in New Zealand need not be to the disadvantage of the United Kingdom,” said the Minister of Industries and Commerce (Mr D. G. Sullivan) at the opening of the conference of the New Zealand Manufacturers’ Federation to-day. “We still have to take payment for our exports in imports, and shall always have to do so, unless, of course, we leave the proceeds lying in Great Britain as capital, as we did to some extent during the depression. "The expansion in manufacturing activity in New Zealand during recent years,” Mr Sullivan continued. “ was accompanied by substantial increases in our imports from the Mother Land. In fact, imports increased at a much greater pace. For example, manufacturing production reached its lowest level in 1932-33, at £17,700,000. Imports from the United Kingdom similarly touched their low point at £11,200,000 in those years. By 1936-37 imports had grown to £226,700,0000, and factory production to £25,200,000. That is, imports had increased by 125 per cent., whereas factory production had advanced by 50 per cent. only. Even if we allow for the rising population, imports went up by 119.2 per cent, and factory production by 46.6 per cent,” The Minister said that a close study revealed a very different position from what one would gather from a cursory look at the total figures for importations for, say, 1935, 1936, and 1937. The importations in 1935 were £36,317.000, in 1936 £44,259,000, and in 1937 £56,161,000. Analysis of Imports An analysis of the imports showed an interesting situation, the Minister said. In 1936 the total importations were £44,259,000. Of this sum, £14,520,000, or 32.8 per cent., was for materials used in the production of goods manufactured in New Zealand — really raw materials used by manufacturers and others—£2,49s,ooo, or 5.6 per cent., was for fuels and lubricants, which were not produced in New Zealand; £4,515,000, or 10.2 per cent., was for equipment used by producers, such as certain dairy machinery, tractors for farm work, printing machinery, sewing machines, typewriters, and other machines: £6.131,000, or 13.9 per cent., was for transport equipment, such as motor vehicles, railway and tramway equipment, road-making implements, and so on. Finished goods for consumers amounted to £11,466,000, or 25.9 per cent, of the total, and unclassified miscellaneous items amounted to £5,132,000, or 11.6 per cent. In 1937 the total imports were £56.161,000, and the classification was:— Value. £ p.c. Producers’ materials 17,773,000 or 31.6 Fuels and lubricants 2,822,000 or 5 Producers’ equipment 6,029,000 or 10.7 Transport equipment 8,026.000 or 14.3 Finished consumers’ goods 14,591,000 or 26 Unclassified items .. 6.920.000 or 12.3 All-round Expansion The Minister said that actually at present there was a slight decrease in importations. The importations for the nine months ended September 30. 1937, were £41,982,000, and for the same period of 1938 £41,604,000. He realised that there were higher imports in the last quarter of the year. “Nor is there any necessity for expansion in factory production to be at the expense of increasing farm production,” Mr Sulivan said. “What we want in New Zealand is more farm production, more exports, more imports, and more factory production—more production of all the things we need, so that there can be more to consume for everyone. This increased production must not be haphazard, but planned and orderly. Only thus can the standard of living for everyone be raised.” The Domestic Market

“ One of the questions to be answered is, Would there be a market in New Zealand for the greater volume of manufactured goods produce of our own factories? ” Mr Sullivan said. “ The import figures supply the answer. Taking the years ended September 30, the imports from all countries increased from £43,000,000 in 1935 to nearly £60,000,000 in 1938, an advance of £16,166,881. This advance in imports was due to the fact that the purchasing power of the people had been raised, partly by direct action of the Government and partly through higher prices for our exports. The raising of the people’s buying power benefited the manufacturers also, as the figures show. The figures for 1938 are not compiled yet, but, comparing 1936-37 with 1933-34, there is a substantial increase to be seen of over £8,000,000 This, however, is only half the increase recorded for imports during the fouryearly period, and indicates that of the extra £24,000,000 spent on goods in New Zealand, only one-third went into our own factories. The obvious fad is that this extra £16,000,000 worth d goods could have been made by out own people, if —and there we come to some problems

“The shortage of skilled labour at the present time,” Mr Sullivan said “ can largely be attributed to the fact lhat so few apprentices were trained during the depression. This is a question to be faced, and a solution found. With the active co-operation of the workers and manufacturers and the sympathetic assistance of the Government. the problem should be solved.” Preference to Pioneers Mr Sullivan said it was only reasonable that existing manufacturers, who by their pioneering efforts had built up sound enterprises and provided good employment for many New Zealanders, should have the opportunity of participating in anv expansion. It would be unreasonable if newcomers into any industry were permitted to reap all the fruits of industrial expansion. Thus it would be the Government’s aim to make it possible for the present plants to be expanded. “ On the other hand, we are not going to build your extensions for you or nut in more plants.” the Minister said “ The_ existing manufacturers must exercise their own judgment and initiative. If the Government can assist in anv plans of expansion, I hope the manufacturers will let us know their needs. New Industries “ I have been very pleased.” Mr Sullivan added, “to note the number of overseas concerns which think it worth while to commence the manufacture of their products here. Some have come without direct encouragement from us. Others whom we needed in New Zealand have required some inducement.” Encouragement was given in the motor car industry, where there was a lower rate of duty on vehicles imported “ completely knocked down,” Mr Sullivan said. There was scope for expansion in this direction, and he would like to see manufacturers in the United Kingdom take a greater interest in this question. Thirdly, there was tariff protection, Mr Sullivan said. This added protection given earlier in the year had been of very great benefit to many manufacturers, and all members of the Government were very gratified at the remarkable response the manufacturers made to their new opportunities. The Price Factor “ Prices are an important factor to any Government,” Mr Sullivan said. “Anything which can be done to make goods cheaper without sacrificing quality or wages is to be commended. Increased efficiency is the key. Despite enormous strides made in production technique in recent years, 1 feel there are still many improvements which are possible.”