Media Statement

16 May 2003

Boost for trade resources in the Budget

New Zealand's membership of multilateral organisations such as the World Trade Organisation brings direct, tangible benefits to New Zealanders, Trade Negotiations Minister Jim Sutton and Progressive deputy leader Matt Robson said today.

Mr Sutton and Mr Robson said the extra funding for trade negotiations will enhance New Zealand's efforts to achieve a successful round of World Trade Organisation negotiations.

Budget 2003 allocates $14.2 million over four years (and ongoing of $3.2 million per annum for outyears) for support for WTO negotiations and bilateral Closer Economic Partnerships and other trade agreements.

Mr Robson said a multilateral rules-based system which was fair and enforceable suited New Zealand.

"The alternative would be no rules at all, and that would seriously disadvantage small, trading nations such as New Zealand, costing us jobs and prosperity."

He said terrorism and unstable regimes around the world flourished in conditions of poverty.

"Fair trading rules make the world more prosperous, and therefore more secure. We all have an interest in making sure the Doha Development Round is a successful one. The extra negotiating resources will mean that New Zealand can continue to be a nation of influence at the WTO, pushing for fair, rules-based trade."

Mr Sutton said the Doha Development Round, the latest WTO negotiations, was New Zealand's highest trade priority.

He told a meeting of Taranaki Federated Farmers today that the Doha Development Round and bilateral trade agreements held the key for New Zealand's sustained export growth.

"Gains from the Uruguay Round are conservatively estimated at $500 million to $600 million a year, and even greater gains are forecast if the current Doha Development Round is successful.

"Research carried out by MAF on the quantitative benefits of the last big round of international trade negotiations, the Uruguay Round, showed in the single year of 2000 (the year that many of the gains of the Uruguay Round kicked in) the beef, sheepmeat, and dairy sectors gained about $590 million from product price and volume increases in the major markets of the United States and European Union.

"That works out to an average increase in earnings for each sheep, beef, and dairy farmer of $11,500 a year. "

Mr Sutton said trade liberalisation and market access was important for farmers.

"About 90 per cent of all dairy products produced here in New Zealand are exported. About 90 per cent of all lamb, and 80 per cent of all beef, is exported. Market access matters to you ? if New Zealand loses access to key markets, we all suffer."

He said the Government's Budget measures meant there would be more people on the ground both here in New Zealand and at the WTO's headquarters in Geneva, arguing our case.

Mr Sutton and Mr Robson said the Budget measures included government-level efforts to open up market access and to get more firms into exporting.

"Our economic growth depends on policies and actions that improve our capacity to be innovative. Trade is a major priority in the Government's growth and innovation framework."

ENDS

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