WPMA on role of subsidies in log exports

Wednesday 3 Oct 2018

The Wood Processors and Manufacturers Association of New Zealand (WPMA) held a well-attended regional meeting last week in conjunction with the New Zealand Frame and Truss Manufacturers Association in Rotorua.

In his opening address the Chair of WPMA, Mr Brian Stanley, said that he was delighted to see such a large part of the New Zealand wood products’ value chain in one room. He said he was looking forward to discussing with the FTMA the major issues affecting New Zealand’s ability to add value to logs and thereby create much needed employment in the regions.

Mr Stanley pointed out that despite the wood manufacturing industry having all the credentials of the (now, much-sought-after) “zero carbon economy”, with its ability to deliver good jobs, more resilient communities and a better environment, all this is being seriously undermined by the wholesale export of raw logs propped up by overseas subsidies. In this respect, he noted the recent High Court decision directing government to reconsider the case of subsidised steel being dumped on the New Zealand market.

“I read in the press only today headline news about the ramp-up of logs harvested on the West Coast heading directly for the Port of Lyttelton” said Mr Stanley. “West Coasters are right to lament the loss of means to earning a living in a part of the country that offers few job opportunities”.

WPMA has already presented a case to the government pointing out the unfairness of the market for domestic logs. Mr Stanley commented, “overseas buyers can pay inflated prices for logs because they are supported by subsidies. In doing this, they are denying local mills competition for logs at fair and sustainable prices.”

“If it is some comfort to you”, Brian Stanley told the audience, “I can report that the Ministry of Foreign Affairs and Trade’s very recent inquiry into this matter has indeed revealed a long list of subsidies being dished out overseas – subsidies they describe as controversial under WTO law.

For a country so dependent on trade and the international laws that govern trade this finding by our trade officials is crucially important. “Take further comfort from the fact that the Trade Minister, Hon. David Parker, has acknowledged MFAT’s findings by commissioning a formal investigation into the degree of harm being caused in the domestic market for logs”, added Mr Stanley.

“The WPMA is all for free trade, but it must be fair trade and fair trade for all. Right now, our manufacturers are struggling to see the benefits of free trade agreements when they are being strangled by WTO-controversial subsidies. We will be following Hon. Parker’s investigation very closely”, Mr Stanley concluded.

Source: WPMA

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