Tariffs hinder forestry's future development

The New Zealand Forest Industries Council says it strongly supports the Government's initiative to eliminate non-agricultural tariffs in the World Trade Organisation negotiations.

Council chief executive, Stephen Jacobi, said today that trade liberalisation was vital to the industry's future development.

"Without lower tariffs internationally the New Zealand industry will be condemned to remain a grower of trees and exporter of logs," Mr Jacobi said.

"Tariffs in overseas markets penalise added-value production in New Zealand and shackle the industry's growth potential."

Mr Jacobi says tariffs on New Zealand's $3.7 billion of forestry exports cost the country around $40 million a year.

"That does not take into account trade that is completely prevented by tariffs that increase as a product moves through the value-added chain.

"This sort of tariff escalation is a particular problem in South East Asian markets."

Mr Jacobi said forestry jobs depend on export markets.

"The forestry industry already provides jobs for 23,000 New Zealanders directly and a further 100,000 indirectly.

"If we want more jobs in regions like East Coast or Northland, then we must capture more of the value of forest products in New Zealand. That means processing more wood locally.

"That will only happen with better access to international markets, which is the aim of the Government's tariff initiative."

Mr Jacobi said the WTO negotiations offered the best opportunity to address the tariff and non-tariff barriers facing the industry.

"In meetings I had in Geneva last week I found strong interest in innovative ideas to move the WTO negotiations forward. It's good to see New Zealand promoting far-reaching initiatives.

"It confirms our reputation as a problem-solver and will guarantee us a seat at the table when consensus is being sought around key issues."

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