THE OTAGO DAILY TIMES THURSDAY, December 2, 1937. THE GOVERNMENT’S DILEMMA

Otago Daily Times, Issue 23364, 2 December 1937, Page 10

THE OTAGO DAILY TIMES THURSDAY, December 2, 1937. THE GOVERNMENT’S DILEMMA

The Minister of Industries and Commerce cannot have greatly relished the frequency of the calls made upon him to frame the soft answer that averts wrath for the appeasement of the manufacturers of the Dominion. The manufacturers want more protection for secondary industries, and under the Labour Government their claim has inevitably been intensified. The present Government was going to do much by way of building up the secondary industries, but its achievement thus far has been to impose upon them increased production costs through its legislation. It is hardly entitled to sympathy if it is asked to be explicit in respect of its policy. Mr Sullivan’s statement to the annual meeting of the Canterbury Manufacturers’ Association was doubtless carefully weighed beforehand. He expressed regret that he was not able to speak “ authoritatively ” of where the Government stood. At the same time he declared that “every step necessary for the protection and promotion of New Zealand secondary industries was being and would be taken.” The manufacturers, pondering this assurance, may consider that their case is still one of hope deferred. With a problem of its own creation the Government "must wrestle as best it can. How it is going to extricate itself from the dilemma into which it has permitted itself to be forced is by no means apparent. Its policy, as expressed by its own members, has show little coherence. To encourage trade has been one of the professed objectives. In their peregrinations abroad, particularly in their wooing of the British consumer, Mr Savage and Mr Nash have spoken boldly and persuasively. Their message has been to the effect that every shilling which New Zealand receives for her produce on the British market will be spent on the purchase of British manufactured goods after allowing for a deduction sufficient to meet interest and other charges. Under the banner of trade reciprocity they made eloquent appeal for increased marketing facilities for New Zealand’s products. Dominion industries, being out of sight, were presumably also out of mind. Meanwhile in New Zealand the Minister of Industries and Commerce was left to face the gathering clamour of the manufacturers over the effect of the new burdens imposed upon them. Now under pressure he has gone the length of promising them the erection of additional barriers against the importation of goods that are already the subject of a stiff tariff. He has spoken of the Government’s intention of considering the position of New Zealand industries —of which it has yet to get “ a true picture’’—with fairness to the Motherland. We hear a deal on occasion about a flood of imports— Mr Savage'and Mr Nash have lately spoken solemnly about that —but little about the balance of trade, the excess value of exports over imports. Nor in all these discussions is there much evidence of consciousness of the existence of the Ottawa Agreements under which British manufactures are admissible to New Zealand on terms that are supposed to put them on a competitive footing with New Zealand manufactures. What is the Government going to do about it all? The three major countries with which Mr Nash is said to be negotiating in an apparently somewhat frantic effort to discover how it is possible to reconcile two opposing trade objectives so far as New Zealand is concerned, may be reasonably a little surprised at what is expected of them. In the House of Commons a few weeks ago a prominent member of the Labour Party spoke of “ the wonderfully good offer” made by a very able Minister from New Zealand, which promised “ a valuable market for British manufactures and an increasing supply of foodstuffs.” Mr Nash’s comment unon this in the House of Renresentatives was that it was completely correct that the offer had been made by himself on

behalf of the New Zealand Government. Yet in his reply on the financial debate he could emphasise the intention of the Government to protect secondary industries, and, while charging certain manufacturers with being grossly unfair to the Government, declare that it would do all it could to help them. Of three ways in which he said secondary industries could be assisted he made no selection. Mr Savage’s later philosophic sunfmarisation of the position has been that “ consistent with giving effect to the protection of employment and the standard of living of our own workers full consideration is being given to the just claims of British industries and to our trading relations with the United Kingdom and other parts of the British Commonwealth.” Inevitably a Government that does its leaping first has cause to do some thinking afterwards.