Tariff thaw guarantees slow death for clothing industry

Labour is deserting its trade union roots and undermining its own full-employment policy by slashing in half New Zealand's remaining tariffs on imported clothing, Green Party Co-leader Rod Donald said today.

The Government has announced that it will resume cutting tariffs on imports when the current freeze expires in 2005. The Green Party had called for the freeze to remain in place.

"In their mad pursuit of free trade the Labour Government is callously destroying thousands of jobs and dozens of businesses in the textile, clothing and footwear industry," Rod Donald said. "Previous tariff reductions have led to a flood of cheap imports from countries that don't mind exploiting their workers and their environment to turn a dollar.

"How can a Labour Government be so cold-blooded when the Infometrics report it commissioned on the tariff review warned that removal of remaining tariffs would cost at least 1300 jobs, mostly in rural communities and disproportionately affecting Maori, Pacific Island and female workers?

"It will be cold comfort to clothing workers that the Government won't go to zero tariffs immediately. The message to employers and investors in the clothing, textile and footwear sector is that the Government has no intention of protecting - let alone developing - a viable industry in this country.

Rod Donald warned that reducing tariffs would increase imports to New Zealand and hence increase the record trade deficit and the current account deficit.

"The Infometrics report concluded that there was little economic gain to New Zealand in removing the remaining tariffs but then went on to say that we should do just that - purely for theoretical and ideological reasons," added Mr Donald.

"Indeed, it appears that no price is too great for this Government's obsession with so-called 'trade liberalisation'. Why is it unilaterally slashing tariffs to 10 per cent when New Zealand is well within its WTO commitment of 37 per cent and the US has abandoned its push for zero tariffs?

"NZ should have learned a lesson from the debacle at Cancun, which proved once-and-for-all that the developed countries will not drop protection for their own industries. Neither should Labour, if it's serious about its stated economic policy to 'promote sustainable and balanced economic development in order to create full employment'.

"Labour's founders will be spinning in their graves at this abandonment of the very people they created the party to protect."

ENDS

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