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US Lamb Decision Deeply Disappointing



8 JULY 1999

Moves by the United States to impose tariffs on New Zealand lamb are a real kick in the teeth for farmers and a setback for New Zealand's trade interests, Food and Fibre Minister John Luxton said today. It also provides the wrong signal for this year's WTO round.

"The decision by President Clinton to impose 9% tariffs this year on New Zealand lamb imports at 1998 levels is deeply disappointing. It goes further than the ITC's majority decision and the even sharper 40% tariff for any imports above the quota is particularly punitive."

"I'm sure the sympathies of all New Zealanders go out to our sheep farmers today. The Government and industry have made concerted efforts to lobby the US on this issue and have explored every possible avenue. Our sheep farmers are among the best in the world and lamb exports to the US reflect growing lamb demand in that market. Today's decision is extremely frustrating for all concerned."

"New Zealand and US sheep farmers should both be seeking the same objective of growing the US market for their product. Increased prices for consumers will not achieve that goal. The plain fact is that US sheep farmers need to lift their game and New Zealand was offering to help."

"This move is at odds with US statements calling for the reduction of tariffs in the next WTO Round of trade negotiations. Like the recent US decisions to roll over the subsidised export of dairy products under the DEIP programme, this once again shows the US as lacking commitment to making the hard decision to free up international trade. Long term this decision will do more damage to US interests than to New Zealand's.

"As US Federal Reserve Chairman Alan Greenspan, said recently 'If trade barriers are lowered by both parties, each clearly benefits, but if one lowers barriers and the other does not, the country that lowered barriers unilaterally would still be better off having done so.' The Federal Reserve is speaking sense, and I hope its advice is taken more notice of in future." Mr Luxton concluded.

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