RECIPROCAL TRADE.

Star (Christchurch), Volume LXVI, Issue 20222, 5 February 1934, Page 7

RECIPROCAL TRADE.

The Dominion and Great Britain. MUTUAL BENEFITS. “ The case for reciprocal trade with Great Britain,” was the subject of an address given by Mr William Goodfellow, a member of the New Zealand delegation to the Ottawa Conference, at Ballantyne’s to-day. He was speaking at a complimentary luncheon arranged by the New Zealand Producers’ and United Kingdom Manufacturers’ Reciprocal Trade Federation, of which he is tile Auckland branch chairman Mr J. llislop, of Auckland, who represents the United Kingdom manufacturers on the executive of the federation, was also present and delivered a short address. Mr llislop dealt at some length with the privileges and obligations of New Zealand under the Ottawa Treaty. He laid stress on the iact that the Ottawa Agreement was the beginning of an entirely new trade era between Great Britain and her Empire countries. He pointed out that tne British Import Duties Act of 1932 definitely put an end to the unconditional free market that had been enjoyed by the Dominions in Great Britain during the past sixty years. Britain had met the tariff walls of the Dominions by putting a fence around her market, leaving only a gate marked “ Via the Ottawa Agreement.” ”It is our respensibilit)’ to see that that gate is kept open, and it is to ask your aid towards tiiis end that we are here to-day,” declared Mr llislop.

He maintained that Britain’s policy according to the treaty was that in return for her free market and certain pieferential treatment referred to in schedule B, New Zealand was to abolish all purely revenue tariffs. That principle was established by Britain’s demand to remove the surtax of 9-40ths and the small 3 per cent primage duty levied even on goods which were otherwise free from all tariff. Also under clause 7 of the Agreement it was beyond the power of New Zealand to levy a tariff on British goods unless similar goods were being produced in New Zealand with reasonable opportunity of success: and thirdly, when successful production was attained in New Zealand, that a tariff might be applied for its protection, but not of sufficient height to debar Britain from becoming a domestic competitor. Agreement Ratified. He expressed surprise that during the sitting of the Tariff Commission many witnesses trading under disabilities of high tariffs approached the commission asking for a reduction of them, as the goods in question were not manufactured in New Zealand. He claimed that those firms could have demanded of the commission the total abolition of the tariff In dealing with the question of revenue, Mr Hislop stated that he would never believe that New Zealand would so far forget her dignity and duty as to permit the needs of revenue to influence her in giving effect to the Ottawa Agreement. The Ottawa Agreement was too important a milestone on the commercial road between the Motherland and the Dominion to be treated as a scrap of paper, and the honour of New’ Zealand was too sacred a thing to treated with indifference for the mere needs of revenue. Dominion’s Dependence. Mr Goodfellow said that there were thirty-five branches and sub-branches of the federation throughout the Dominion which endeavoured to further the need for a free market in the United Kingdom. He emphasised the dependence of New Zealand on the United Kingdom for trade, finance and defence. As for trade, compared with other dominions, New’ Zealand made a poor showing, for she exported practically as much as Australia and Canada to the United Kingdom, but bought from the Old Country an amount considerably less than the other dominions. In many casts trade was being diverted from the Old Country but without any benefit to the United Kingdom. He felt that New Zealand failed to realise that the United Kingdom had changed her trade policy, and, indeed, a complete change had been brought about at the Ottawa Conference. The United Kingdom had carried out the agreements made at that conference, but New Zealand had not made any serious attempt to carry out her share of the trade agreements. Dealing with the change in British policy, Mr Goodfellow’ quoted several authorities to show that the United Kingdom w’as earnest in the effort to alter her adverse trade balance. There w’as the feeling that the Dominion had done well, but the federation’s view was that that was hot the case, as New Zealand’s adverse balance was greater than that of any other Dominion. They did not think, moreover, that at the end of a three-year period the British Government w’ould penalise the Dominion if she carried out her part of the agreements. He quoted further authorities which declared that it would be wrong to treat all the dominions alike at the end of the threeyear period. Treatment on results was considered to be much preferable. Duties and Quotas.

The possibility of having to meet import duties and a quota had brought New Zealand up with a round turn. New Zealand had to decide on closer trade relationship, with lower tariffs, and no quota, or on reduced exports to the United Kingdom, which result in a lower standard of living and a link-ing-up with Australia. Undoubtedly the wisest course would be to stick to Britain. They had much to gain from a closer agreement with the United Kingdom. Objections to the sch.eme were that unemployment would increase and revenue would drop with lower tariffs. However, application of the sales tax would offset the drop in Customs duties. Mr Goodfellow produced a chart to show that 60 per cent of the community were not employed in primary or secondary industries, and he went on to show that only 4 per cent of the 15 per cent of the people of the Dominion engaged in secondary industries would be affected by free trade with Great Britain. They would either have to become more efficient or change their occupations. In conclusion he detailed the advantages that would accrue to the Dominion from a lowering of tariffs or the institution of a free market with the United Kingdom.

Mr W. Machin presided. On the motion of Mr P. L. Porter, the speakers were accorded a vote of thanks.