ADVERSE EFFECT ON BUSINESS

Southland Times, Issue 23715, 13 January 1939, Page 3

ADVERSE EFFECT ON BUSINESS

CONTROL OF IMPORT TRADE INQUIRY INTO SECONDARY INDUSTRIES URGED (Special to The Times) AUCKLAND, January 12. An analysis of the various classes of business, which, in its opinion, are likely to be adversely affected by the im-' port control regulations, has been made by the Bureau of Importers after conferring with the different sections of its membership. The bureau urges that a Royal Commission should be set up to ascertain which New Zealand secondary industries can be conducted economically. “It is now obvious.” states the bureau, “that the full repercussions will not be felt for a month or two, and those whose services have already been dispensed with represent a very small proportion of those who will ultimately be thrown out of employment. So far as the various departments of a business are concerned, it would appear that the effect will be as follows:— Selling staff, storemen and packers, clerical workers, executive' officers. “Though one cannot forecast with any accuracy the order in which the various classes of business will be affected, present indications are that the position will be as follows: —

“Agents handling lines solely for delivery during the second period; commission agents and importers handling “prohibited” lines, such as sports goods, clocks, matches, canned fish, meat pastes, plated ware, artificers’ tools; small agents and importers handling Japanese, German and Czechoslovakian goods; dealers in fancy goods; softgoods hands dealing in Canadian and Australian lines; agents for luxury lines such as refrigerators, radios, washing machines; softgoods agents and footwear importers dealing in United Kingdom lines; merchants handling household ironmongery and crockery; wholesale houses only partially dependent on imports; retail establishments chieflv dependent on imnorted goods; local

manufacturers and suppliers of industrial equipment.

“With the consequent reduction in imports, the damage must spread, and the next section of the community to be affected will be the shipping companies, insurance companies handling marine risks, Customs agents and Customs officials, wharf labourers and tally clerks, carriers and railwaymen. “Though. a certain, number of this class must be kept in continual employment, the volume of goods handled will be less, thus increasing the percentage of overhead cost to the importer. The great business of exporting and importing is by far the largest employer of labour in the Dominion, and, when one considers that present indications are that our imports will be cut down by at least 40 per cent., it is easy to visualize the vast number who must be thrown out of employment. “Mr Savage assures us that New Zealand’s secondary industries are to be given a chance. We maintain that our secondary pursuits have had that opportunity for many years, and since 1931 have had protection of between 60 per cent and 120 per cent., and still in many cases have failed to compete with the imported article. We are only too happy to see any economic industry prosper in New Zealand, but when the Government adopts a 'dog-in-the-manger’ attitude and says, in effect, that the local manufacturer must continue regardless of cost, we do object, knowing as we do that the public must ‘pay the piper.’ The prohibiting and quoting of imports will put many importers out of business and allow the local manufacturer to proceed with industries which have already been proved uneconomic. “We suggest that the time is opportune for the setting up of a Royal. Commission to inquire into secondary industries in New Zealand generally and particularly into the following: Matchmaking, footwear, clothing, fruit preserving and jam-making, sauce and pickle-making, woollen manufacturing and hosiery. ECONOMIC INDUSTRIES “The commission first and foremost should ascertain whether an industry is able to manufacture economically. If such can be proved it should then be determined what percentage of the New Zealand trade can be supplied, taking into consideration the following factors :— “(a) The capitalization of those firms engaged in the industry, (b) The efficiency of the workers, the plant and the equipment, (c) The maximum economic ontnut. (di The percentano <->f lohmn>

cost, imported raw material, and locally-produced raw material represented in the value of the output, (e) The protection necessary for the industry to compete with corresponding importations. ' “An impartial inquiry conducted along these lines would be in the interests of all concerned and would tend towards economic production and the cessation of any uneconomic industries which were being fostered under prohibitive tariffs. The findings of an impartial commission would, we believe, be acceptable to every section of the community and would at least disclose the fact that New Zealand cannot be economically or advantageously selfsufficient.”