135 Cabinet Economic Committee Minute

Wellington, 9 December 1980

E (80) M 46 PART V. CONFIDENTIAL

Australia - New Zealand Economic Relationship: Meeting of Permanent Heads1

Officials stressed that, on the question of the dairy trade between Australia and New Zealand, no commitment should be given by New Zealand to either a Government to Government agreement to limit dairy exports from New Zealand to Australia or a voluntary restraint arrangement concluded between the New Zealand Dairy Board and the representatives of the Australian dairy industry. To pursue such a course of action would be to step on to a very slippery slope indeed. All that could be said to the Australians at this stage was that any formal limitation on the dairy trade between Australia and New Zealand was unacceptable to New Zealand, notwithstanding any restraint which might have been exercised voluntarily by the Dairy Board in the past; such a formal limitation would represent a reduction in access and would hence be completely contrary to the goals of the Closer Economic Relationship. In New Zealand's view, the Dairy Board should be allowed to export such quantities of dairy produce to Australia as it considered appropriate in light of all the factors relevant at the time. This was the view that would continue to be transmitted to the Australians.

Officials also noted that the New Zealand Manufacturers' Federation had recently qualified somewhat the position that its representatives had outlined in person to the Committee some weeks ago. However, it did not seem that these qualifications would affect the conduct of the Permanent Heads' meeting during the coming few days; they might nevertheless be a factor in the Government's deliberations on the Permanent Heads' final recommendations.

[matter omitted]2

[ABHS 950/Boxes1221-1226, 40/4/1 Part 32 Archives New Zealandffe Whare Tohu Tuhituhinga 0 Aotearoa, Head Office, Wellington