RECIPROCAL TREATY.

Otago Witness, Issue 3881, 31 July 1928, Page 13

RECIPROCAL TREATY.

NEW ZEALAND AND JAPAN. REDUCTION IN BUTTER DUTY. . WELLINGTON, July 24. A reduction of about one halfpenny in the pound in the duty on New Zealand butter exported to Japan is the chief advantage that New Zealand will gain from a trade treaty which ’has been entered into with that nation to-day. Details of the arrangement, which comes into force on August 9, were given to the House of Representatives to-day by the Minister of “Customs (Mr W. Downie Stewart), who explained that no concessions were being given Japan other than a continuance of the present policy of admitting Japanese goods at the same rate of duty as that charged on the goods of any other foreign country. A further feature is that the treaty, so far as can be ascertained, is the first with a foreign country that has been signed in New- Zealand, the practice in such cases in the past being to become party to a treaty signed by Great Britain. The Notes which passed between the two Governments on the subjects were tabled in the House to-day by the Minister, who said.—“ For some time past negotiations have been going on with the Japanese Government through the Japanese Consul-general at Sydney for the conclusion of a commercial arrange-, ment between Japan and New Zealand. It has been decided by both Governments that, pending the adhesion of New Zea - land to the Treaty of Commerce between Great Britain and Japan, each country should afford the other most-favoured-nation treatment, so far as commerce, Customs, and navigation are concerned. The matter was arranged to-day by means of an exchange of Notes between the Japanese Consul-general and the New Zealand Government. This means that, while the arrangement remains in force, New Zealand products will, in Japan, on and after August 9, receive tariff treatment as favourable as those of any other

foreign country. My information shows that Japan has commercial and similar treaties with other countries under which lower rates of. duty are at present charged on certain articles produced in those countries than on similar goods of New Zealand origin, So far as this Dominion is concerned the chief advantage will be a reduction in the duty on locally-pro-duced butter of about id per lb. It may be of interest to know that Canadian butter has for some time past been admitted at the lower rate. In this connection the following figures, showing the exports of this commodity to Japan from New Zealand, Canada, and Australia may be of interest:— EXPORTS OF BUTTER.

So far as Australia is concerned these are the latest years for which statistics are available. Tariff reductions are also made in Japan on a limited 5 number of other articles similar to those produced in the. Dominion, e.g., certain preserved vegetables and fruit, worsted yarn, and wool tissures. “The arrangement has the further advantage that if in future any reductions in duty are made in favour of any other country they will, while the agreement stands, automatically apply to New Zealand. This Dominion has always admitted Japanese goods at the same rate as that charged on the goods of any other foreign cojintry. This, no doubt, has induced the Government of Japan to enter into the present arrangement with NewZealand. There is the further point that if New Zealand in the future reduces the duty on the goods of any foreign country, whether by way of a tariff treaty or otherwise, the benefits of such a treaty, ■while the present arrangement with Japan continues, automatically apply to the goods of the country. “So far as commerce and navigation are concerned New Zealand already accords to Japan treatment as favourable as that accorded to other foreign countries as will be seen from the Notes which

have just been laid on the table of the house. The agreement remains in force until the expiry of three months after notice of termination has been given bv either party.” The Notes were couched in the following terms:—From the Prime Minister onp" Coates ) to Mr I- Tokugawa. U.8.K., Japanese Consul-general at Sydney, under to-day’s date: “I have the honour to inform you that pending the eventual adhesion of New Zealand to the Treaty of Commerce and Navigation between Great Britain and Japan, and th» supplementary convention thereto, signed at London on April 3, 1911 and July 30 1925, respectively, the New Zealand Government is prepared to accord to Japan on and after August 9, 1928, the same treatment in the matters of commerce, Customs, and navigation as is or may be accorded to the most favoured foreign country, provided that the Japanese Government grants to New Zealand the same treatment in matters of commerce, Customs, and navigation. It is understood that the aforesaid treatment shall continue m force until the completion of three months from the date on which the New Zealand Government shall have denounced it.”

From the Consul-general for Japan to the Prime Minister of New Zealand- “I have the honour to acknowledge the receipt of your note on the subject of the treatment to be accorded by the New Zealand Government to Japan in matters of commerce,- Customs, and navigation, pending the eventual adhesion of New Zealand to the Treat}’ of Commerce and Navigation between Japan and Great Britain and the supplementary convention thereto, signed at London on April 3 1911, and July 30, 1925, respectively. Under instructions from my Government, I beg to inform you that the Japanese Govern—ment. is prepared on its “side to accord to New Zealand, on and after August 9, 1928, the same . treatment in matters of commerce, Customs, and navigation as is, or may be, accorded to the most favoured foreign country, provided that the New Zealand Government grants to Japan the same treatment in matters’ of commerce, Customs, and navigation, it being understood that the aforesaid treatment shall continue in force until the expiration of three months from the date on which the Japanese Government shall have denounced it” ' ■ . \

The Leader of the Opposition (Mr H. E. Holland)., .while observing that it was

satisfactory to know that New Zealand butter was to be admitted to Japan at a reduced rate, inquired whether anr reciprocal concessions had been ma'de to Japan. It was a pity, he added, that the House had not had notice that the papers were to be presented. Mr G. W. Forbes (Hurunui) considered that, as a general practice, copies of papers to be submitted to the House should be circulated to members beforehand. He asked the Minister to inform members why New Zealand had previously been placed on a heavier duty list than other countries by Japan. Mr E. P. Lee (Oamaru), who also supported the plea for the earlier circulation of papers, said it would be interesting if the Minister explained the statutory authority which enabled the negotiations referred to to be entered into and consummated.

In the opinion of Mr J. A. Lee (Auckland East) Reform members were now subscribing to the contention of Labour -during last session—that unrestricted bargaining powers should not be vested in the Minister.

Mr A. Harris (Waitemata) said one would expect to see special reciprocal arrangements made with European rather than Asiatic powers, although he, was casting nd reflection Japanese-manu-factured goods. He had held the view that New Zealand, so far as its external trade was concerned, had all its eggs in one backet, and he had supported the extension of its markets.

The belief was expressed by Mr W. A. Veitch (Wanganui) that the people of New Zealand would welcome an international agreement such as had been entered into, and would not cavil at the details. — (“Hear! hear!”) It was a move to a better understanding between two close neighbours. He reminded the House that New Zealand had reason to be grateful to Japan for what she had done during the war years. Replying, the Minister said that- the papers could not have been circulated earlier as the Consul-general for Japan had arrived in New Zealand only that morning, and he had been anxious that the notes should be signed to coincide with the visit of the Japanese Navaj. Squadron. As the matter had been fully discussed for many months past there had been no difficulty in complying with the request. While certain points affecting New Zealand were under discussion with the Imperial Government butter producers, especially those in the North Island, had asked him whether it would not be possible to anticipate the benefit which it was expected would result from New Zealand’s final adhesion to the treaty between Great Britain and Japan. It was, therefore, decided that if such an advantage could be secured for the butter producers, it would be unwise not to do so. Japan had entered into a treaty with France, and subsequently its benefits were extended to other countries, including Canada, placing that dominion in a better position with regard to exports than New Zealand, and our exporters were anxious to be on the same footing. The Home authorities had agreed to New Zealand’s action in view of the urgency of the matter. “As a matter of fact the treaty puts New Zealand in a better position than Australia,” the Minister contined. “ Indeed. I believe the Australian butter producers have been reproaching themselves for allowing New Zealand to get ahead of them in this important matter. My object was to improve the position of our butter exporters who are developing trade with Japan, and who were finding themselves hampered by not being in as good a position as Canada.” Regarding reciprocity, there was no' concession given to Japan. She already enjoyed the same advantage as other nations were afforded by our foreign tariff. Japan’s object in signing the treaty was partly due to a recognition of the way she had been treatetT by NewZealand, and partly because she desired to share in. any concession we might make in the tariff to any other foreign countries. The authority to sign the agreement was vested in the Government by reason of the sovereign powers vested in New Zealand. It was the normal practice to place the papers before the House, which he supposed could reject them if it so desired'. The only effect of such rejection would be to leave the existing law as it stood, and rob the butter producers of New Zealand of the concession which had been obtained.

EFFECT OF NEGOTIATIONS.

MR TOKUGAWA INTERVIEWED. WELLINGTON, July 24. In an interview to-night the Japanese Consul-genera'l for New Zealand and Australia, Mr I. M. Tokugawa, expressed his -pleasure that notes had been exchanged between the New Zealand arid the Japanese Governments in relation to the proposed trade treaty. Canada had accepted an agreement between Great Britain and Japan some years ago with certain reservations, and it was probable that the New Zealand Government might desire to make certain reservations, as Canada had done in the matter of immigration. The commercial treaty between Great Britain and Japan, said Mr Tokugawa, was made in 1911, and modified in 1925, and any self-governing dominion at anv time can adhere to it. Canada adhered to it some years ago, but New Zealand had not done so, and this exchange of notes was to bring about the adherence of New Zealand. The arrangement up to now was quite provisional, and by it neither country conceded anything beyond what was granted to other foreign countries. In practice, New Zealand would, from the date of its taking effect, pay a lower duty in Japan-on her butter, because the Japanese tariff was yen 36.90 (10 yen equal about £1), for 100 kin (one kin equals about 1 l-31b weight). This is the present general tariff, but Japan had a specal tariff for France, at which the rate was yen 33.65 per 100 kin. By. virtue of the notes which had been exchanged New Zealand butter would enjoy the same tariff asj was now extended to France, and which Canada was already receiving. In adhering to the treaty Canada had made reservations in regard to immigration. So far as Japanese-imports into New Zealand were concerned, there would be no benefit at present, as New Zealand had. ,no special tariff granted to any foreign country, although provision was

made by which she could allow a special tariff to a foreign country in the future. As regarded commerce and navigation, both countries were already receiving from each other the most favoured nation treatment, and the exchange of letters was merely a confirmation of the existing status. He was pleased at what had been done, as it would bring the two countries into closer trade relationship, and especially as it had come on the eve of arrival of the Japanese squadron. There would be - matters of detail to be discussed, continued Mr Tokugawa, and he realised that there would be certain points which were all right between Japan and Great Britain, but which would not be quite on the same basis between Japan and New Zealand. “ So, although New Zealand will, as I hope, adhere to that treaty and convention, it is perfectly understood that some reservations may be made —for instance, the question of the entry into New Zealand and the residence in New "Zealand of Japanese subjects. In the case of Great Britain Japanese subjects are allowed freely to enter and live in that country without restriction. Of course, in the case of New Zealand, Japan'has no intention of insisting on that. If New Zealand adhered to the treaty without reservation then Japanese subjects would bo able to enter freely.” That was merely an example, and* there would be many points to be discussed before New Zealand adehered to the treaty and convention.

New_Zealand to Japan— Cwt. Value. 1926 .. .. 1,886 £14,923 1927 .... 2,844 22,430 Canada to Japan— 1926 .. .. 4.774 37,486 1927 . _ .. 3,662 29,410 Australia to Japan— 1924-25 .. .. 802 6,511 1925-26 .. .. 1,169 9,897