RECIPROCAL TRADE

Rotorua Morning Post, Volume 2, Issue 599, 2 August 1933, Page 6

RECIPROCAL TRADE

N.Z. AND BRITAIN VERY SERIOUS SITUATION CONFRONTING THE DOMINION •MR. GOODFELLOW IN ROTORUA With the object of promoting reciprocal free trade between New Zealand and the United Kingdom, an organisation has recently been formed known as the New Zealand Producers and United Kingdom Manufacturers' Reciprocal Trade Federation. One of the chief movers in the formation of the federation is Mr. W. Goodfellow, late chairman of directors of the New Zealand Dairy Company, Limited, and one of the recognised leaders of the primary produeing interests in the Dominion. Branches have already been formed in the four centres aiid the organisation is now proceeding in other parts of the country where sub-branches of the federation are being formed. In pursuance of this policy, a very representative meeting was held in Rotorua yesterday when Mr. Goodfellow addressed a gathering of businessmen and farmers from all parts of the district. At the conclusion of the meeting, a branch of the federation was formed and a large general committee was set up to proceed with the work of organisation. One of the chief objects of the federation is to counter the propaganda of the New Zealand Manufacturers' Association which is coneentrating upon a policy of protecting New Zealand secondary industries. It is considered by those responsible for the movement that this policy is inimical to the best interests of the Dominion and that unless definite steps are taken to improve the trade relations between the Dominion and the Mother Country, irreparable harm may be caused.

Mr. Goodfellow, in the course of his address, emphasised the urgency of the position and expressed the opinion that unless New Zealand took steps more fully to honour the Ottawa agreements, she was likely to find preferential duties erected against her on the Home markets at the expiration of three-year period during which Britain guaranteed an unrestricted market for dairy produce. Mr. H. M. Martin occupied the chair at yesterday's meeting and at the conclusion of Mr. Goodfellow's address, those present, 22 in number, formed themselves into a general committee. An executive committee was appointed as follows: Messrs. H. M. Martin, S. J. Hale, Major Herrold, O. H. Coleman (chairman-con-vener) and F. Parlane (secretary). Emphasising the necessity for effective measures to meet the position, Mr. Goodfellow quoted figures to show the extent to which New Zealand was dependent upon the British market. In 1932, New Zealand had exported produce valued at £37,000,000 and of this amount, £32,000,000 had been bought by Great Britain. The growth of the dairy industry was evidenced by the fact that last year the Auckland province had exported £9,000,000 worth of produce out of a total Dominion production of £15,500,000. Dairy products now represented 42 per cent. of the total value of the Dominion's exports. In the same year, 1932, New Zealand had imported goods to the value of £23,000,000 but of this only £11,500,000 had been purchased from the United Kingdom.

These figures showed the extent to which New Zealand was dependent upon the United Kingdom market but in addition Mr. Goodfellow referred to a number of other reasons why it was an the interests of the Dominion to buy from Britain. In the vital question of its defence, the Dominion was almost entirely dependent upon the proteetion of the British Navy. For its present and future development, it was almost entirely dependent upon British capital. It was not realised in some quarters that New Zealand loans were treated as trustee securities on the London market, a privilege which was not extended to foreign countries. This enabled the Dominion to borrow in England at the lowest possible rates. Mr. Goodfellow also referred to the splendid work done by the Empire Marketing Board in popularis'ing Dominion products in the.Homeland. Referring to the trade position of the United Kingdom, he said that in 1932, Great Britain had exported goods to the value of £422,000,000 and had purchased goods, chiefly foodstuffs and raw materials, to the value of £711,000,000 wh'ich had resulted in an adverse trade balance of £289,000,000. Living On Capital Mr. Goodfellow reviewed the trade position of the United Kingdom over the last four years and showed that during 1931-2, it had been living on its capital. This was a position which could not continue indefinitely without disaster. This hlad resulted in :a. change in the trade policy of the British Government which had been carried into effect in the Ottawa agree- | ments. These agreements had led to a great deal of adverse comment by British farmers who had accused New Zealand of dumping while manufacturers and importers had contended that the Dominion had failed to lonour the pledges implied in the Ot:awa agreements.

Serious Situation As a result a very serious situation had developed and it was extremely fortunate ,that "ijhe Prime Miriister and the Hon. R. Masters had been in England and had been able to represent New Zealand's case. Mr. Goodfellow claimed that the feeling which had arisen at Home was : largely caused by New Zealand's fail- • ure to carry out the Ottawa agree- ; ments. There was no doubt that the i British Government would honour its ; part of the bargain and that we would : have free markets for the next two ' years but unless, in that period, some- • thing was done to reduce tariffs and l satisfy the British Government, New • Zealand might find that her exports : would not only be restricted but at the end of the two-year period, would • be subjected to preferential duties. • ; Mr. Goodfellow pointed out th'at 80 I; per cent. of the people in the United 4 Kingdom were directly or indirectly interested in 'trade and that the Bri- *; tish Government was not likely to develop agriculture to any extent so long :« as there was a reasonable possibility

of the suppliers of foodstuffs accepting payment in manufactured goods. He pointed out that there was no talk of a quota in regard to Northern Ireland which had free trade with the'United Kingdom while certain of the Freneh and Dutch possessions also enjoyed the same advantages. No Other Markets Mr. Goodfellow made it clear that there was no other worthwhile market which could be speedily developed by the Dominion. It was very much in the interests of New Zealand that free trade should be developed with the United Kingdom and that everything possible should be done to foster the goodwill of our best customer. He pointed out, also, that by allowing the goods of the United Kingdom free ingress into' New Zealand, a very substantial contribution would be made to a reduction in the cost of living in the Dominion and in England. In conclusion,'' Mr. Goodfellow said that it wias most important that all sections of the community should realise the gravity of the situation. At no time had the trade relations between New Zealand and the United Kingdom been so strained as they were at the present time. He urged them to support the New Zealand Producers and United Kingdom Manufacturers' Reciprocal Trade Federation as a movement designed to promote reciprocal trade between the two countries and do something toward overcoming the unfortunate position with which: we were at present faced.

Manufacturers' Case Mr. J. Seabrook, of Auckland, a member of the Federation, dealt with the position from the viewpoint of the British manufacturers. He pointed out the many advantages of reciprocal trade between the United Kingdom and tbe Dominion and the necessity for a free interchange of goods. He said that the United Kingdom, by reason of its huge population, was excellently suited to the manufacture of high class goods by mass production methods while the Dominion, on its part, was equally well suited to the production of high class foodstuffs. An interchange of these classes of commodities between these two countries must react to their mutual benefit and lead to a reduction in the cost of living in both. In conclusion, Mr. Seabrook referred to the many enthusiastic meetings wbich had been held in connection with the Federation's activities in tbe Auckland district and expressed the opinion that this augured well for the success of the whole movement. The meeting closed with votes of thanks t0 both speakers and an unanimous endorsement of the aims and objects of the federation. Meetings will be held regularly. and the committee will proceed vigorously with the work of developing the Federation's progress in the Rotorua district.