350 billion reasons to get Doha sorted for ‘NZ Inc.’
“New Zealand will be bound for the top half of the OECD if the Doha trade round can be completed successfully,” said the
president of Federated Farmers, Don Nicolson, in response to the positive noises emanating from the APEC summit in Peru.
“The New Zealand Treasury tells us we need an unprecedented increase in the average annual rate of economic growth just
to hit the median OECD income per capita. If the Doha trade round is concluded successfully, it will the proverbial
magic bullet for the economy.
“There are 350 billion reasons for the world to end the pestilence of agricultural subsidies, tariffs and restrictive
market practices. Each one is called a US dollar,” Mr Nicolson said.
The World Bank’s Global Economic Prospects 2004 report highlighted that agricultural producers in the OECD receive
US$300 billion in subsidies each year. If the Doha trade round can be concluded successfully, the benefit to the global
economy is estimated to be at least US$350 billion.
Federated Farmers’ single biggest fear from the current global crisis is a return to protectionism. Protectionism is now
seen as one of the major reasons why the share market crash of 1929 turned into a global economic depression By
contrast, New Zealand agriculture has been proudly subsidy free since 1985. Despite predictions other countries would
follow suit, New Zealand’s example for much of the past 23-years has been just that, an example. This makes the current
APEC summit and the pledge to kick start the Doha round of trade talks, so important for every single New Zealander.
“Sometimes it takes a sharp recession to focus political minds on what is really important,” Mr Nicolson added.
“It makes no sense whatsoever for OECD countries to pour US$300 billion of subsidies just to prop up inefficient
agricultural producers. This is as bad for the global economy as inefficient agriculture is for the global environment.
“Subsidised agriculture is a cancer on trade as the protectionism it masks is the single biggest threat to global
“Given just how bad the global economic outlook is, perhaps, finally, politicians will realise they’ve wasted billions
of dollars to achieve nothing. Surely they can find a better use for those subsidies, such as on health, education and
“I am absolutely convinced that if we crack Doha, New Zealand will make better progress in reaching the top half of the
OECD. We produce food with lower food miles and much better green miles than almost any other country and we do it all
on a level playing field,” Mr Nicolson concluded.