RECIPROCAL TRADE

New Zealand Herald, Volume LXX, Issue 21577, 23 August 1933, Page 11

RECIPROCAL TRADE

BRITAIN AND NEW ZEALAND OBJECTS OF FEDERATION IMPORTANCE TO DOMINION [from our own correspondent] HAMILTON, Tuesday A national movement to promote freer reciprocal trade between Britain and Now Zealand was tho subject of comment by Mr. W. Goodfcllow, managing director of Amalgamated Dairies, Limited, addressing a conference of the committeemen of tho New Zealand Co-operativo Dairy Company, Limited, this evening. Mr. Goodfellow, who is advisory director to the latter company, in giving details of tho newly-formed organisation established for furthering freer trade, said tho New Zealand Producers and United Kingdom 'Manufacturers' Reciprocal Trade Federation, usually called tho Freo Trade Federation, had advanced in its work, and, during tho past few weeks, a largo number of branches had been formed throughout South Auckland. Tho speaker said the necessity for tho organisation was tho absolute dependence of New Zealand on tho British market. Britain took 87.7 per cent of tho Dominion's exports in 19.32, a much higher percentage than that of any other Dominion. Dairy produce represented 42 per cent of New Zealand's exports, and practically tho whole of tho produco was marketed in Britain, for the simple reason there was, in reality, no other market available. Talk that New Zealand must find other markets clearly indicated tho dependence of the Dominion upon Britain. Dominion's Best Customer It was necessary, Mr. Goodfcllow continued, to encourago tho most friendly trading relationship with the Dominion's best customer. It had also to bo remembered that New Zealand was just as dependent on the British Navy for protection, and, apart from other considerations, the Dominion was dependent almost entirely on tho United Kingdom for new oapital. As a direct result of the changed policy of Britain, a tariff was imposed on foreign produce, and that was being used as a bargaining counter to secure trade agreements from foreign countries. Tho success of tho policy had been amply justified by results. Under the Ottawa agreement, tho Dominions were given a freo market in the United Kingdom for a limited period, during which they virtually agreed to give tho British manufacturer a free market. Manufacturers in local industries were highly protected, and their official organisation, tho New Zealand Manufacturers' Federation, could bo depended on to do its utmost to prevent tho tariff being reduced to a figure acceptable to the British manufacturer. It was tho danger of failure on the part of New Zealand to complv with tho Ottawa Agreement which had been responsible for tho establishment of tho Free Trade Federation. The Increased Exchange

" In the past. New Zealand had an excellent reputation in tho Old Country," Mr. Goodfellow continued, "but. in view of recent events, the confidence of the British public in New Zealand must be rapidly declining." New Zealand had not only been very dilatory in carrying out its portion of the bargain, but, in reality, it had virtually broken the spirit of tho Ottawa Agreement by increasing exchange without making a corresponding reduction in duties, greatly to tho advantage of local manufacturers. Australian exporters had an unfair advantage over British manufacturers. The almost total disregard for tho necessity of adequately safeguarding New Zealand's trade relationship with tho United Kingdom was the outstanding failure of the Coalition Government.

Mr. Goodfellow was satisfied Great Britain would bo only too pleased to gi\*o New Zealand a free market for produce if the Dominion did the same thing. New Zealand was at the parting of tho ways, and would shortly have to make a momentous decision, the result of which would mean prosperity or ruin to the farmers. If tariffs were reduced sufficiently to satisfy tho British Government, New Zealand's primary industries would continue to expand, and tho people would Gradually regain prosperity. If New Zealand did not do tho fair thing to Britain, it would bo up against an unsurmountable difficulty in tho disposal of produce.