[asia-apec 1533] Free trade a myth, says NZ Meat Board Director

[APEC Monitoring Group]

Posted by GATT Watchdog
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The Dominion, Wellington, 25 August 2000
Agribusiness section

Free trade a myth, says director
By Andrea Fox

A Meat Board director says international tolerance for New Zealand's "holier
than thou" free-trade preaching is running out.

John McCarthy said yesterday that the free trade concept promoted by
political and farming leaders was a lemon.

Free trade would never happen and if it did, could backfire badly on New
Zealand red meat producers.

Most New Zealand sheep and beef was exported to Europe and the United States
under "preferred nation" status agreements. If this protection disappeared
with free trade, New Zealand could not compete with overseas meat producers
such as South America, whose costs could be more than 60 per cent less than
New Zealand's.

Mr McCarthy, who has recently returned from five weeks in Europe, the US and
Asia, has made his views known to the Meat Board, which emphasised yesterday
that they were not the board's views.

"Free trade or globalisation is a myth.  It has never happened, but now more
than ever, it is never going to.  We are witnessing the growth of
regionalism as evidenced by the EU, Nafta, Apec," he said.

"The EU with its enlargement over the next 10 years will produce more food
than it can consume.  Increasingly the policies of the EU and the US will
focus on providing trade assistance to developing nations.

"We have good historical relationships in both these markets and our farming
enterprises are dependent upon the retention of that goodwill.  It is up to
us to develop strategies to that end."

Mr McCarthy, a Meat Board director for 18 months, said New Zealand's
"lambasting" style, which was once regarded with tolerance as part of an
interesting experiment, was now irritating the Europeans, who were battling
with the complexities of the European Union.

He had been particularly dismayed at the style of special roving
agricultural ambassador Malcolm Bailey who had been "lambasting everyone who
disagreed with the principles of the now shaky World Trade Organisation in
various publications"

"I am not convinced this method of holier-than-thou diplomacy is in fact in
our best interest.

"There is growing concern worldwide about aspects of the free-trade
philosophy and this was demonstrated clearly by the level of protest at
Seattle."

Mr McCarthy said New Zealand should increase its efforts to maintain and
develop new communication channels with trading partners.

He suggested joint efforts in nutritional and consumer research, a
willingness to admit shared problems, and a drive to find common solutions.
The WTO shakiness was exacerbated by the US and Europe circling each other
"like a couple of pitbulls" over issues such as multifunctionality and
genetic engineering.

The multifunctionality argument, used by some countries in defence of their
continued protectionist policies, says agriculture creates more than food,
such as environmental protection, and rural employment.

Mr Bailey said this week that New Zealand argued vigorously against the
defence.  But Mr McCarthy said it also could be argued that New Zealand had
much to gain by adopting the principle.  "Surely the multifunctional role of
agriculture is equally important in rurally focused countries such as New
Zealand, especially with the 'nature dimension' as it affects tourism
potential, as it is in picture postcard Europe?"