391. Message From Prime Minister Holyoake to President Nixon 1
My dear Mr President,
You will be aware of the recent adoption by the Senate Finance Committee of a Bill incorporating a rider which would amend the 1964 Meat Imports Limitation Act to include quotas for imports of lamb into the United States.2
I want you to know that the New Zealand Government, which is attempting to strengthen its overall relations with the United States, would regard with the utmost concern any additional restrictions on its exports to your country. As I pointed out during my visit to Washington last year,3 New Zealand cannot be expected to play its full part in areas of international cooperation, including regional security arrangements to which the United States attaches importance, unless it has the trading opportunities which provide it with the economic means. There is a direct relationship between New Zealand’s capacity to play its part as a good ally and its ability to earn from fair trading opportunities overseas. Restrictive action on New Zealand’s exports to the United States makes it difficult for the New Zealand Government to justify to our people our alliance with the United States in other areas. To provide a further underpinning for this relationship I stressed that New Zealand—a country which has never received or asked aid from any other country—sought, not privileged treatment, but merely greater freedom to apply its competitive advantage in pastoral products.[Page 983]
It is within this context—of economic as well as political interdependence—that I ask you to consider the proposed legislation to impose quotas on lamb imports. Such a measure could, in my view, result in irreparable damage to the United States/New Zealand relationship. It is of vital importance to New Zealand, as the world’s largest lamb exporter, to preserve unrestricted access to the United States market for this product. Lamb contributes substantially to New Zealand’s export earnings. At present almost all dairy products are already under quota in the United States and exports of New Zealand’s other major meat products to the United States are being limited to avoid quota action. Exports of agricultural products are responsible for the overwhelming bulk of New Zealand’s overseas earnings, and in respect of the United States, lamb is one agricultural product for which New Zealand has a chance to develop its exports in a modest but, to us, significant way.
It is my firm belief that the volume of lamb which New Zealand is likely to be in a position to export to the United States will do more good than harm to the American industry. The domestic industry in recent years has consistently declined. Sheep numbers have been reducing at the rate of a million a year. Neither Government support for wool nor favourable market prices for lamb has induced the American industry to increase production. Imports have not offset this decline—far, far from it—and the amount of lamb in question is derisively small measured against the income level and meat-eating capacity of the United States. I would submit that, rather than constituting a threat to United States producers, New Zealand’s promotion efforts, by preserving the extremely limited taste for lamb and extending that taste to new groups, offer about the only possibility of keeping the American industry alive.
New Zealand has gone about developing the trade in lamb in a responsible way over a period of years, incurring considerable expenditure in the process. Now an attempt has been made by a small group to render fruitless this effort and this investment. New Zealand has not failed to note the commitments of Administration spokesmen to include freedom to trade among the four economic freedoms which are to form the basis of United States trade policy during your term of office. Secretary Stans has spoken of the “dim view” which you take of quotas and other protectionist devices that may become permanent. I stress the point that New Zealand regards the issue of unimpeded entry of lamb as a talisman of this commitment.
In terms of this commitment and New Zealand’s efforts to strengthen its overall relationship with the United States, my Government looks to your Administration to take an unyielding stand against the legislation at present before the Senate. I believe that there is no economic justification for the proposed quota action and that the [Page 984] issue is a quite simple one of foreign and trade policy considerations. I hope you will find it possible in this context to give tangible expression to your declared policy of trade liberalization and to the ANZUS Treaty and to make known, quickly and decisively, that legislative action to restrict lamb imports will not be tolerated by your Administration.
- Source: National Archives, RG 59, S/S Files: Lot 72 D 320, New Zealand: Nixon to Holyoake. Confidential. Sent to Secretary Rogers for delivery to the President under cover of a June 4 letter from the New Zealand Ambassador. (Ibid.) In his July 22 reply the President noted the Prime Minister’s expression of concern and wrote that his administration sought freer international trade and wanted to avoid new trade restrictions, “save for the most exceptional circumstances.” He indicated that these views had been communicated to Congress and concluded, “Although no partnership can be without its occasional difficulties, I shall make the most serious effort to insure that New Zealand’s interests are advanced rather than harmed in all decisions related to our mutual affairs.” (Ibid.)↩
- In a June 5 memorandum to Under Secretary Richardson concerning the legislation, Acting Assistant Secretary Greenwald wrote in part: “There is no economic justification for the legislation: domestic supplies are low, imports comprise only 4% of total supplies, and lamb prices have reached record highs. Adoption of this legislation would not only create serious problems in our relations with Australia and New Zealand but also give impetus to the adoption of further quota legislation and of retaliatory action by our trading partners.” (Ibid.)↩
- Prime Minister Holyoake visited Washington October 9-10, 1968.↩
- Printed from a copy that bears this typed signature.↩