Agreements at Ottawa

Hokitika Guardian, 14 October 1932, Page 5

Agreements at Ottawa

DISCLOSED BY MR COATES IN HOUSE

DETAILED CHANGES IN CUSTOMS TARIFF

RESTORATION OF PRICE LEVEL IS SOUGHT ' q‘b . sr. ; !»*'•/<»<:; ' " 1 ' o>; ,(Per Press Association— Copyright.} fio ftilj \- — — WELLINGTON, October 13. • The Right Hon. J. G. Coates to-night made a statement in detail on. the Ottawa Conference Agreements. He said: “I now wish to lay on the table the full text of the agreement between the United Kingdom and New Zealand. • Later on, after ample opportunity for debate has been given, I shall move fcr the ratification of the agreement, and a Customs Bill embodying to*night’s resolutions will come down at an early date. The Ottawa Conference of 1932 marks a milestone in the history of our Empire. No previous colonial or imperial conference was charged with issues—with menacing dangers if it should fail, with* richer promise if it happily succeed — with issues more vital to the welfare of our people.”

The World-wide depression had passed beyond the stage at which it was Within the power of any nation by its single-handed offorts to arrest the drift, Co-operation bn d wide scale was urgently necessary, not merely to effect recovery but to prevent further collapse. The British nations looked to Ottawa to set them by co-operative effort on: the high road towards recovery. Other nations,, equally in the grip of thb depression, were also alive to the bearing of the ■ conference on their own welfare. ’ “Anything; that would hasten recovery in the one-fourth of the world which is included with the Empire would be the most effective way of asr sisting also the other three-fourths. Eveints, prior to the conference, Great Britain’s) steadfast calm in the face of adversity, and the success of her great conversion loan, had strengthened the ability of the British Empire to play its traditional part in leading the world towards recovery. Our ideal and immediate purpose was, to contribute towards a general recovery. , .’ “I cannot express: this sentiment better than by recalling the words of Mr Baldwin, in his opening address, to the Conference, Stressing the need for the channels of trade among ourselves,” and for promoting commerce within the Empire, Mr Baldwin noted that “there are two, ways in Which increased preference can be given—either by lowering barriers among ourselves, or .by raising them against others. V >• “We should endeavour,” lie said, '‘te'folldw tile first rather than the Second... cqtir^e.;!-For.., Jiowever •••great' bur feSoUrces, we caniiot. isolate o tii> Selves from the world. No nation or group of nations, however wealthy apd, populous, can maintain prosperity ih a world where depression and impoverishment reign." The delegations from each and every Dominion at Ottawa subscribed to this ideal. I emphasise that loyalty to the agreement requires that .we should remove barriers to trade, and hindrances so largelyl responsible for common impoverishment in a world abounding with the means of plenty.

tain to embark upon a new trade policy designed to help the Dominions, without our facilitating her trade. The agreement definitely commits New Zealand to a thorough overhaul of her protective tariff duties. “This should be undertaken not merely for the purpose of giving effect to the Ottawa agreement, but is, I firmly believe, in the interests of our own people. Already the distance that separates New Zealand from the outside world gives subsatntial protection to local industry. Further artificial protecion, which is so easy to establish, so difficult/' to curb or remove, is apt to be a costly business, for our country. If we are to export we must import—we cannot have oneway trade. We are apt in judging the results of the Conference to weigh the concesions granted by the United Kingdom against the concessions granted by New Zealand. BiiF it must be remembered that the so-called “concessions” we made in reducing tariffs are not of advantage toi United Kingdom exporters alone. They are a gain to ourselves. The contrary view rests upon the fallacy, of assuming that tariff duties are paid by the purchasers and consumers. There reduction is therefore a, necessary step towards lowers costs of production and lower cots of living. Not all the results of Ottawa can be expressed in terms of Customs-schedules and tariff changes. The Conference afforded a n opportunity for agreement on matters in which our countries face common problems I refer to some of these. The representatives of nil Governments were emphatic in describing the collars? in commodity prices, unprecedented in its suddenness, as the most serious a’*P ec 't of the depression, This has wiped out margins of profit, causing industrial stagnations and unemployment. It has' rendered fixed monetary obligations intolerable and has necessitated most drastic measures of adjustment. By general agreement, first the raising of the general pricelevel, and then its reasonable stabilisation, must be our objective. Ways and means of achieving this were discussed and a policy of co-operation with the United Kingdom was agreed upon.

. “I now turn to the changes in the New 'Zealand Customs tariff to which we hgree. Generally, our undertaking is thati “protection by tariffs shall be afforded against United Kingdom products only to those industries, which are reasonably assured of sound opportunities for success.” Wo agree to institute an inquiry into existing protective duties (at which . inquiry United Kingdom producers will., have facilities for expressing , their views), and where necessary we will reduce protective duties to such. 1 a. level as will place the United Kingdom producer in the position of a domestic comnet'itor, that' is, to quote the text of the ..agreement, they will be reduced to a level ! “which will giv,o the United Kingdom producer, full opportunity of reasonable competition on the ba,sis of the relative cost of economical and efficient production/’ “We agree also to remove at once the surtax on goods produced in the Unitqd Kingdom and, when. financial conditions permit, to remove the pri* mage duty of three, per cent, advalorem. These were imposed, it will be recalled, for revenue purposes and not for the protection of local industries; ......

it is emphasised that the decline in prices in New Zealand, as elsewhere, has been more marked in -wholesale than in retail prices. This disparity, the widening gap between wholesale and retail, is of finst importance in discussing measures to restore prices to a profitable level. What we seek to restore is the wholesale price level. An a rise in this does not necessarily mean an increase in the cost of living. In every country in which prices have recently collapsed it can be shown that at least a partial restoration of the wholesale price level can be achieved, not by raising retail prices but by closing in part tho additional gap that has recently appeared as between wholesale and retail prices. Mr Coates expressed himself in favour of a central bank, mentioned Ottawa discussions on radio and cinema trading, and said that communications are proceeding between Governments regarding slurping competition in the Pacific. RATIFICATION MOTION ADJOURNED.

“Turning now to the detailed changes in our customs tariff to which we are committed by the Ottawa agreement, and which will bo placed before thei House to-night in the form of Customs resolutions. The issue bag to some extent been clouded through the alarmist propaganda Of interested parties who have tried to discount Ottawa by alleging the bctrayal of our secondary industries.‘-I' htfve' said enough to show tho House and country how fantastic is the statement that, bv the Ottawa Agreement, our. local indus. tries have been .sacrificed-. - There is nothing in the agreement or in our obligations under it that will prejudice the establishment or the growth of sound industrial enterprises in New Zealand“We are, however, bound by the letter and by the spirit of 1 the agreement, to see that reasonable opportunities for trad 1 are extended t 0 the Briiili mr'nufac tuiyr. Already the general fall in "rices h”s injured trade and materially added to the burden of protective duties. If we are. to revive trade, it must be on a reciprocal basis, Wo cannot, expect Great Un-

WELLINGTON, October 13

The Right Hon. J. G. Contes, in the House of Representatives presented the Ottawa statement and customs resolution. Urgency was accorded the customs resolutions which were adopted at 12.30 a.m. The Premier, the Right Hon. G. AY. Forbes then moved formal motion ratifying the agreement between the United Kingdom and New Zealand. The Leader of the Opposition moved an adjournment of the debate which was set down as the order of the day for Tuesday.