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Friday, May 24, 2024

Alwyn Poole: Economics 101 on Importing and Exporting


Most countries focus on the economic benefits of exporting. They accrue primarily to the producers but they flow on it to employees and relevant towns. Consumers lose as they end up either paying the world price for the product (e.g. our fruit, fish, meat, etc) or accepting a much lower quality. Anyone who has been to a country like Japan and seen NZ quality kiwifruit or apples is unlikely to forget how amazed they were. In my life – in NZ – I have only once eating export quality steak and any export quality fish I have caught myself.

We focus a great deal less on the benefits of importing – which are equal but accrue to the less powerful consumer block that has limited means of influencing government.

I am currently in Brazil. Below are watermelons and avocados that are not only much bigger and of incredible quality – but a fraction of our prices. The watermelon comes in at $1.90 per kg.

At present European farmers are protesting NZ products and NZ producers are offended. NZ consumers need to work out what they would like to come in at world quality and world prices and push for those products. It would improve our “cost of living crises”.

Alwyn Poole, a well-known figure in the New Zealand education system, he founded and was the head of Mt Hobson Middle School in Auckland for 18 years. This article was sourced HERE
























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1 comment:

CXH said...

Don't give up the day job. The exporting of the top quality products is economic. You have fixed charges to export - freight, paperwork, marketing etc. Doesn't matter what you send, the costs are the same. So economics 101 shows only an idiot would export second grade products, therefore making less for the same amount of work.

If Brazil found a market for these products, the top grade would no longer be available in Brazil. Then there would be moaning about how they only get the rejects.

Economics 101 is easy, but often misunderstood.

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