THE New Zealand Herald AND DAILY SOUTHERN CROSS WEDNESDAY, FEBRUARY 22, 1933 DOMINIONS AND TRADE

New Zealand Herald, Volume LXX, Issue 21423, 22 February 1933, Page 8

THE New Zealand Herald AND DAILY SOUTHERN CROSS WEDNESDAY, FEBRUARY 22, 1933 DOMINIONS AND TRADE

A desire is being shown in Australia to explore the whole question of trade relations between that country and New Zealand. A reference shows that the embargo on imports of Australian fruit, recently imposed by New Zealand in retaliation for a similar Australian embargo of longer standing, was the starting point for a discussion which ended with the decision of wider scope just mentioned. It is well that the Federal Cabinet saw the wisdom of broadening the basis of inquiry, because in the years that have followed the reciprocal trade agreement of 1922 commercial conditions have suffered a number of shocks which are favourable neither to cordiality of feeling nor prosperity in economic relations between these two countries. As will appear clearly enough when details are considered, neither can escape blame for the depressing sequence of duties and counterduties, embargoes and retaliations which has developed within the past ten years. At times it has seemed as though trade across the Tasman was likely to do deadly injury to one or other of the parties to it. At other times each country has appeared to believe that it was good to sell but that to buy was a process which must be avoided at all costs. The simple explanation of what would otherwise seem a hopeless exhibition of illogical thinking and economic blindness is that political influence has been exerted to interfere with the flow of commerce, that on both sides the pressure of sectional interests has found a malleable Government. If the situation is to be examined with any good result, this influence will have to be rigidly excluded. It is, as already suggested, an unhappy story that describes the deterioration of trade relationships across the Tasman. In 1922 a reciprocal trade agreement was made.' Until then Australia had enjoyed at the hands of New Zealand much better treatment than that received in return, having been given full British preference, without conceding it. Just before the treaty was made New Zealand put Australian goods on the general tariff, and thus awakened a readiness to bargain. It was drastic action, but justified by circumstances and results. The treaty made after negotiation by Mr. Downie Stewart in Australia was generally acknowledged to be a fair bargain. It contained a provision allowing for variation of the terms by either party on giving six months' notice of that intention. The first breach of normal relations came nearly six years ago, when Australia put an'embargo on New Zealand potatoes —ostensibly as a precaution against the introduction of plant disease. Before long New Zealand had an embargo on Australian potatoes, with the same excuse. Then New Zealand wished to increase the duty on wheat and flour, that being the time when the now notorious sliding scale was imposed. Australia was asked to waive the right to the six months' notice,' and agreed. Presently Australia, finding that the Paterson stabilisation plan neutralised the duty of twopence a pound on New Zealand dairy produce—the treaty rate—and that in times of domestic scarcity butter was entering the Commonwealth, proposed to increase the duty to sixpence. New Zealand insisted on the six months' notice. It was given, and the higher duty imposed. The latest development over fruit, Australia imposing an embargo for fear of fireblight, New Zealand establishing one as pure retaliation, is still recent news. Taken together these incidents show the trend of trade relations. The actual examples cited do not exhaust the list of commodities concerning which action has been demanded. In Australia, for instance, there has been outcry at different times against the importation of milk powder, hams and tinned sheep tongues. Going further afield, the action, and continued* threat of action, by Canada against New Zealand butter should be generally familiar. So should the sorry story of what, New Zealand failed to achieve by retaliatory action against Canadian manufactures. Lest it be thought the story is wholly onesided, it must be recalled that when, some years ago, before the complication of exchange rates affected trade, jams from South Africa began to appear in New Zealand in quantities that could be noticed, a dumping duty was imposed for reasons very inadequately stated. Also it must be recognised that importers complain of duties and customs regulations making trade with Canada in flour quite impossible. The upshot of it all is that while the spirit so demonstrated is allowed to rule, there is little to hope for between the Dominions from such conferences as that held last year at Ottawa. Leaving aside the purely bi-lateral agreements made between Britain and the several Dominions, can it be said anything w-as achieved to develop Empire trade? Is there any real hope of advancing such an objective while the Dominions appear on the alert only to stamp into extinction the very beginnings of what might grow into a wider commerce? Is it encouraging or inspiring that the narrow commercial nationalism of which such grave complaint is heard in older lands should flourish so vigorously in these young countries? If Australia does explore the question of trade relations with New Zealand,, it is to be hoped some prospect of establishing a broader and more tolerant mutual attitude will be discovered. It is stated that instead of sending a Minister to this Dominion, Australia will ask for a New Zealand representative to visit the Commonwealth. It matters very little which way the Tasman is crossed so long as some attempt is made to meet and overcome the spirit of unexpressed antagonism which has blighted trade relations between the two countries.