Foresters progress on trade barriers

By PAM GRAHAM

Forest industry representatives are optimistic their ideas for resolving trade barriers will be taken up after a presentation in Geneva.

New Zealand Forest Industries Council chief executive Stephen Jacobi and members of an international group of forestry industry organisations he chairs got "in the door" to talk to the non-agricultural market access negotiation group of the World Trade Organisation, which covers forest and wood products.

Jacobi said higher tariffs on processed wood than on logs and non-tariff barriers such as building codes were hampering New Zealand's third-biggest export industry from processing more.

New Zealand has a small domestic market for the output of large forest estates and at present 55 per cent of forestry exports are logs.

"This figure has been rising steadily over time as our industry produces more and despite the fact that we are also processing and exporting more than ever before," said Jacobi.

"There is no doubt in our minds that one of the principal reasons for expanding log exports is the impact of trade restrictions."

He estimates that the forest industry faces $40 million in tariff and $175 million in non-tariff barriers.

This does not include the cost of trade that does not happen because of barriers.

Benefits could be worth hundreds of millions, he said.

"The key thing is we were able to take this message direct to the negotiators.

"We had 30 countries in the room."

His group suggested that a pragmatic approach to negotiating would be to form small groups of interested countries to come up with solutions that could be taken up by the whole WTO.

He said the presentation to representatives from 30 countries was timely because the EU has just said it was prepared to negotiate on export subsidies for agriculture and the Doha round of trade negotiations had to come up with ideas of a way forward by July after talks failed in Cancun last September.

"We proposed that the way to negotiate is to take a sectoral approach and try to work out an understanding among small groups of countries that would be offered to the WTO as a whole," said Jacobi. Talks would be more manageable than exchanging long wish lists.

Jacobi's international group, which includes the United States, Canada, South Africa and Australia, is suggesting starting with building and construction and looking at standards, quality assurance, testing methods, building codes and enforcement of regulation.