N.Z. IMPORT POLICY NOT BEING CHANGED

Grey River Argus, 3 April 1948, Page 5

N.Z. IMPORT POLICY NOT BEING CHANGED

Trade Charter s Effect

WELLINGTON, April 2. I cannot see any likelihood of any early change in our import selection policy in New Zealand as a result of the trade charter drawn up at Havana,” said the Minister of Finance, Rt. Hon. W. Nash, at a press conference today. “It could not be done without at the same time doing a frightful lot of harm to the country, and we do not contemplate that.”

Mr Nash said the charter gave the right to New Zealand to continue its present import selection policy, if the abandonment of that policy was likely to create an imminent threat to our balances overseas.

“We say there would be that threat if we returned to the conditions which obtained here in 1937,” said Mr Nash. “Our policy of full employment might tend under certain conditions —although not at present—to exert perpetual pressure on imports because of the high purcnasing power distributed through employment and by other means. We ease ’ that pressure by our import licensing systems and nothing in the charter prevents us from continuing that policv.” IMPORTS AND EMPLOYMENT

Quantitive restriction of imports, as practiced by New Zealand, could be continued if it were re sted to the country concerned. New Zealand's case for continuing the system was justified, because if the. restrictions were swept away there would be despite our present healtny overseas funds, a flood of imports which would exhaust our balances. New Zealand’s demand for capital equipment alone would, if it could be satisfied, immediately jeopardise our funds overseas.

It will be a long time, as far

as I can see, before we can grant complete freedom of imports into 1 the Dominion,” Mr Nash de-

clared. The clause of the charter which met New Zealand's needs is in the direction of continuing the import restrictions was known at Havana as “the New Zealand clause.” Some of the delegates were “a bit sore” about it at first, but later considered it satisfactory.

Mr Nash said that just as the charter entitled New Zealand to continue its import selection in relation to its full employment policy, so it also ensured that New Zealand could not be obliged to abandon full employment and, consequently, import selection. New Zealand would, however, play the game along with the other nations in furthering freer trade between all countries. » NEW WARTIME INDUSTRIES

Mr Nash mentioned other grounds on which undeveloped nations might and would gradually ease restrictions when it became possible. A_ny country which started new industries between January 1, 1939 and March 24, 1948, as a result of war conditions, might use quantitive restrictions for a period up to 10 years—and in special circumstances for a further five years—-to protect such industry if in that time it could become reasonably economic. It had co be proved that such industry was a genuine “war baby.” New Zealand had few such industries, but a possible example was the manufacture of radio equipment, which expanded vastly during the war. “However, I think the New Zealand radio industry, which during the war manufactured for the Americans in the Pacific equipment better than they could get from their own country, could now put up a good fight on its own account,” said the Minister. Quantitative restrictions may also be used to protect industries established to manufacture to the second or third stage indigenous primary products of the country concerned." For example New Zealand would be entitled to apply such protection to the manufacture of woollen cloth, but not of silk cloth. Probably other criteria which would entitle countries to the automatic right to maintain quantitative restrictions would also be agreed to at a later date.

“There is no point in the charter, other than the sections to whiclj Britain and the Commonwealth counries have already agreed ta, about the ultimate elimination of all preferences, under which British preferences can be interfered with without the consent of the British countries,” said Mr Nash, discussing the sections o ft he Havana Charter dealing with non-discrimination.

At the Geneva Conference Britain, while nat agreeing to abolish Commonwealth preferences, had agreed not to establish new preferences to British countries. However, when at Havana it was found that provision was being made for the institution of new preferences between certain groups of countries with integrated trade interests under certain conditions, Britain had claimed the right to the same treatment for the British Commonwealth countries as would be accorded other groups. FREE TRADE AREAS

, Agreement was reached at Havana that groups of countries, for instance the Central American States or the Arab countries in the Middle East, might establish a free trade area among themselves while maintaining uniform tariff protection against goods from outside countries. It would also be possible under the charter for European countries to form a customs union To meet the needs of the jt.nt.isn Commonwealth and its preference system, a special footnote was included in the charter to the eltect that organisation could accept as an economic region a group of countries not having geographical proximity, if it was satisfied that those countries had a sufficient degree of economic integration. , , , The leader of the British delegation had told the conference that rhe “British Government will look to tne organisation to interpret this with the footnote and to consider the proposals for new preferences m our British Commonwealth group on tne same basis as applications for new preferences by other econom.c groups.” , , Mr Nash stressed that it was also understood that the British countries would not' b e expected to make concessions in preferences, unless other countries gave pro rata concessions through reduced tariffs.