Export red tape cost put at $1.6bn

By BRIAN FALLOW

Non-tariff barriers to trade are costing New Zealand exporters $1.6 billion a year, a Government-commissioned survey has found.

Such compliance costs include quarantine and food safety restrictions, standards requirements and customs and port procedures.

The survey also suggests this form of protectionism is getting worse, is as prevalent in the country's main trading partners as in newer markets, and affects large exporters most.

Of the survey's 381 respondents, 19 per cent believe non-tariff barriers have worsened over the past three years, compared with 8 per cent who report an improvement.

Exporters to Australia were more likely to report a deterioration.

"The Australians are pretty naughty about using sanitary and phytosanitary standards as a barrier to trade," said Trade Minister Jim Sutton.

When respondents were asked to quantify compliance costs associated with non-tariff barriers, 43 per cent said they were less than 5 per cent of export value but 21 per cent said 10 per cent or more.

Five per cent of New Zealand's $32 billion of annual exports would be $1.6 billion.

Export Institute president Bob Fenwick said a 5 per cent compliance cost was entirely plausible.

Nor was he surprised by the survey's finding that the biggest problems were in longstanding trading partners such as the United States, Australia, Britain and Japan.

The database of the survey, carried out by ACNielsen, records which exporters have problems with which barriers and where. It should prove valuable information for officials in Standards NZ and the Ministries of Foreign Affairs and Trade and Economic Development.

Standards NZ chief executive Rob Steele said it was not the smaller newcomers to exporting who reported the most problems.

"Our largest and most experienced companies regard non-tariff barriers as having a significant effect on their export earnings."

Paul Steere, chief executive of Nelson-based NZ King Salmon, said it was amazing that some official stamp carried more weight than the reputation of the producer, who had most to lose.

But the years of effort to open up the Australian market were worthwhile, he said.

King Salmon's exports of fresh salmon across the Tasman had gone from nothing in 1998 to $2.25 million so far this year.