Will Carbon Burden The NZ Economy?

The New Zealand Manufacturers and Exporters Association (MEA) says that the introduction of the Government's carbon trading regime disadvantages industry and could result in New Zealand's companies losing yet more comparative advantage in relation to our international competitors.

The Association says that with leading APEC countries backing away from mandatory commitments on climate change, the issue of carbon emissions is a case of 'old game but new rules'.

"The problem is that yet again the Government wants to be out there promoting New Zealand's clean, green reputation, but without uniform international action then nothing much will change regarding the level of carbon emissions globally", says Chief Executive John Walley.

"As a result, New Zealand will see the local cost of carbon increase, lose yet more comparative advantage and see carbon emissions off-shored but unchanged from the atmospheres viewpoint".

"The overall aim of cutting the carbon emission rate and introducing a carbon trading regime is a positive, but given that New Zealand is responsible for around 0.3% of the world's carbon emissions, do we really have to lead the charge? If New Zealand eliminated carbon emissions from industry, agriculture and domestic activity, it would not make a whole lot of difference to global carbon emission levels".

Mr. Walley says that New Zealand will continue to develop new technologies, as has become the focus of other countries, but there needs to be an equitable application of costs within the carbon trading regime that avoids being good for some sectors of the New Zealand economy and bad for others.

"There needs a broad recognition that carbon will cost, and that cost will ultimately be paid by the consumer. However, there also needs to be a process whereby 'all emitters pay' without exempting some sectors. Carbon emissions are carbon emissions, regardless of where the carbon comes from".

"While it is good for New Zealand to be seen as clean and green at world forums, simply off-shoring the carbon emission or putting the cost burden onto a limited number of sectors, will not only result in more comparative disadvantage for industry, but ignoring other carbon emissions really does nothing to reduce our carbon footprint".

"At an overall practical level, what do we improve?"

ENDS

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