Christchurch Trade Burst Executive Director
Christchurch Trade Burst Executive Director – Suse Reynolds
Now it’s time to tell you why you are all here! We are absolutely delighted to see you all and thrilled you could come. Christchurch has been in the Trade Liberalisation Network’s sites for some time, so it is great to be here.
We are particularly pleased to be co-hosting this event with Minter Ellison Rudd Watts. They are a key sponsor. Thanks so much Scott, for your firm’s support.
What is the Trade Liberalisation Network?
The TLN was established in July 2001 to encourage public understanding and support for trade and our key messages are that trade liberalisation should be rules based and that trade is the means to more jobs, better lifestyles and greater choice. This sounds terribly mundane, but it’s a fabulous job.
So what does trade liberalisation mean to Christchurch?
I grew up in Christchurch. It’s such a great city and a shining example of the importance of trade liberalisation.
Nearly half a million people live in the Canterbury region. Not one of them isn’t touched in some way by the degree of trade openness we have today.
Some of the more tangible examples of this are dotted around the room in our posters. You can pick up mini versions of these as you leave if you’d like to.
Most importantly, trade liberalisation is all about creating the best environment for business to thrive. As a leading US aircraft engine manufacturer, Pratt and Whitney, points out in the Canterbury Development Corporation’s stunning “Pure Business” publication “Christchurch is a very attractive place for international business”.
Let’s look at what trade means to Canterbury.
Exports from the region are worth in excess of $5 billion a year. This makes the region responsible for more than a sixth of the country’s total export earnings.
Half a million beef cattle and over seven million sheep graze Canterbury farms. More than 80 percent of the meat they produce is sold into some 60 different off shore markets. Another half a million dairy cattle produce 20 million litres of milk and almost all of it (95 percent) is consumed outside New Zealand.
Twenty million dollars worth of logs leave the Lyttelton and Timaru ports every year. The forests they come from generate 1600 jobs.
The region earns millions of dollars of foreign exchange from the export of services too. Around 800,000 tourists visit Canterbury every year and spend about $4,000 each. More than 15,000 foreign students also study here every year.
But trade is not just about exports. It’s about imports too. We sell our goods and services overseas to be able to buy those goods and services we don’t generate ourselves. Three billion dollars worth of goods were unloaded from the region’s ports in the year to June.
Abolishing import licensing and tariffs on 95 percent of our imports has spurred Canterbury’s economic growth. Industry benefits through access to competitively priced inputs and the latest technology. Ordinary Cantabrians benefit too.
When trade restrictions were at their height new outfits for the family to wear to the show would have taken twice as much from the household budget. Since the remaining tariffs on cars were abolished a year or two ago many families do not a give a second thought to owning a second car and there is so much more variety in the car park at the show.
What about the downsides?
Trade liberalisation is a complex issue. There are downsides too. At times there is a need for policies to help business and employees adjust to the effects of more open markets.
But many of the downsides are over played. Before handing over to Brian I want to address two or three of these very briefly.
It is frequently argued that imports and open economies destroy jobs. Actually it’s only infrequently that imports that are to blame. Technological change and other non-trade factors, such as monetary policy, the business cycle and labour market flexibility account for most workers who lose their jobs.
In June this year, Trade Negotiations Minister, Jim Sutton, released figures from an MFAT study which estimated that the improved market access gained as a result of the Uruguay Round had contributed $9 billion to the economy in ten years and played large part in the creation of over 17,000 jobs.
Developing countries are harmed by international trade say our opponents. In fact it’s an inability to trade which harms these countries as rich economies deny them access to their markets with high tariffs and import quotas. World Bank studies, cited by aid agencies, note that if developing countries could increase their share of earnings from world exports by just 5% this would generate some US$350 billion in additional income – seven times as much as they receive in aid.
Anti-trade advocates say international commerce is destroying the environment. In fact those countries that have benefited most from international commerce have better environmental records than those who have not.
The provision of services benefiting the environment turns over $420 billion a year globally. Freeing up this trade would benefit the environment as trade barriers prevent modern eco-friendly technologies from spreading as fast as they might.
What’s your role in all of this ?
There are two things you can do …
Be informed … no matter how far you might feel you’re removed from trade issues, the nub of it is your living standards will only improve if New Zealand is fully attuned to the international market place and performing strongly in it.
And speak up for trade liberalization … if your business exports or imports then speak up for the need for open trading environments. If you appreciate the choice we now have in our supermarkets and hardware shops point this out to people who say New Zealand products should be protected by tariffs. If you hear anyone saying trade is bad for jobs, developing countries or the environment tell them what the real story is.
It’s now my real pleasure to hand over to Brian Lynch, the Chairman of the TLN Board. He will give you a quick over view of New Zealand’s international trading relationships.