PM warns on 'dirty' dangers

By Angela Gregory

Overseas countries might exploit environmental concerns as new ways of creating trade barriers with exporters such as New Zealand, says Helen Clark.

The Prime Minister, in a public dialogue with Australian Prime Minister Kevin Rudd, yesterday told an Australasian climate change and business conference in Auckland that New Zealand could not risk being seen as a "dirty producer".

She said that as protective quotas and subsidies were knocked over, countries would look for new ways to create trade barriers.

"I suspect they will be environmental," she said.

New Zealand also risked having overseas consumers shun its products unless the country rose to the challenge of reducing its agricultural carbon emissions.

Helen Clark said it was critical to understand the kinds of decisions consumers in First World countries would be making.

"They are going to be looking at the environmental integrity of products ... if we do not reach a benchmark then we lose, simple as that."

She said when she was in London the New Zealand trade and enterprise people were always telling her to get out the message about the pressure our products were increasingly under in European markets.

She had no doubt the problems would be replicated in Japan, the United States and Korea, and eventually the middle-class markets of emerging economies.

Helen Clark said that although New Zealand's free-range grasslands were more emission-friendly than the intensive agriculture of Europe, and although shipping was energy-efficient, consumers would "drill down" on other issues.

Her comments came a day after Stephen Tindall, founder of The Warehouse and an investor in green technologies, told a breakfast meeting that food miles had been used as an excuse by a large British retailer not to stock New Zealand products.

Mr Tindall said that two weeks ago a party of four from a New Zealand company had a meeting cancelled as they were flying to London.

He would not name the company, but said it sold dairy products.

It had been invited to Britain by Sainsbury's but during the flight the retailer's merchandise department told the buyer it was not prepared to supply New Zealand product.

Mr Tindall said food miles was given as the reason, which if so was "incredibly serious" for New Zealand.

"They are still a risk ... we have to be incredibly careful as a country."

Mr Tindall said New Zealand needed to work closely with Asia, particularly over primary produce, so it could supplement markets if Northern Hemisphere sales went awry.

Fonterra yesterday confirmed to the Herald it was not the company.

John Hutchings, general manager sustainable production, said Mr Tindall's anecdote sounded bizarre.

"Everything we've heard is that it's moved beyond food miles to embedded carbon [all stages of a good's manufacturing process]."

He said consumers were mainly driven by quality and price issues.

Helen Clark warned about the risk of New Zealand being left as a supplier of low-value commodities to poor buyers.

"We need to pitch to the high end of the market and be able to sell to very discerning and fussy consumers."

She said there was a high level of awareness among major processors of international consumer trends.

"The worst thing would be to be labelled by First World, 21st-century markets as a dirty producer when consumers are going to be making more and more ethical decisions about what they buy on the basis of how produce is transported and distributed."

Helen Clark said New Zealand was making progress in tackling agricultural emissions and was a leader in pastoral greenhouse-gas reduction.

"Our scientists are very busy."

She said New Zealand had a fantastic brand.

"People do think New Zealand is clean and green and 100 per cent pure, so giving substance to that is incredibly important ... the last thing we want is a slogan which doesn't have meaning to it."

Mr Rudd said there was a clear emergence of a consumer-led movement, like in the United States, around environmental issues.

He said countries such as New Zealand and Australia, which took pride in their clean, green reputations, would have to stay ahead of the game.

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