x Abu Dhabi, UAESunday 21 January 2018

Aussies just keep biting back over Kiwi apples

The countries are used to sledging each other in sports, but Australia's efforts to keep banning New Zealand produce are proving less than fruitful to the relationship

Australians pay above the odds for apples, according to two academics at the Australian National University. Greg Wood / AFP
Australians pay above the odds for apples, according to two academics at the Australian National University. Greg Wood / AFP

A New Zealand newspaper recently described Australia's highly protected apple industry as the equivalent of Australia being 400 runs behind in its second innings on the final day of play with only a couple of wickets in hand.

The Aussies fight on regardless, despite the fact that defeat stares them in the face. The latest googly aimed at the industry was delivered by the World Trade Organisation (WTO), which found that the Aussies' ban on foreign imports should have been dismissed decades ago. Australia banned New Zealand apples in 1921 after Kiwi orchards suffered fire blight, a disease that attacks the tissues of the tree including blossoms, leaves, shoots, branches, fruits and roots.

That blight of nearly a century ago has been the excuse not to accept the humble Kiwi apple ever since. Indeed, nobody can get a foreign apple into Australia - not even Australia's new best friend China, which has become a rising producer of exported fruit. This hypocrisy from a country that has never been short on sledging EU and US farm subsidies, is breathtaking. Australia led the movement to ban protected agriculture in the Doha trade round but uses its quarantine rules to keep out some foreign imports.

Australia argues that the ban on apples has always been justified on the basis that there is a serious risk that fruit brought into the country may be tainted by blight or any number of diseases. Funny that, because New Zealand scientists claim that on a visit to Australia in 1997 they found evidence of fire blight in cuttings taken from the Royal Botanic Gardens in Melbourne. The Australians have tried this protectionist trick with salmon until a WTO disputes panel in 2000 ruled the country was in breach of its rules by banning fresh, frozen or chilled salmon. Once competition was introduced, imports rose and the price of salmon to the consumer fell significantly.

Of course, the reasons for the ban are political - not ecological, as the Aussies would have you believe. The highly conservative National Party, the political wing of Australian farmers, is protecting its growers from apples that are better priced and probably better quality. Aussies pay more for their protected, unblighted apples to protect an entrenched minority, which would not want to see it any other way.

According to two academics at the Australian National University, consumers in the country are paying way above the odds for their apples. Only the Japanese pay more. Malcolm Bosworth and Greg Cutbush also estimated that the ban on imports was the equivalent of consumers directly paying growers A$2 billion (Dh6.57bn) over six years. When Kiwi trade negotiators tried in 1986, 1989 and 1995 to gain access to Australian consumers they were rebuffed. Four years ago, access was granted, with the proviso that Kiwi apples had to be bathed in chlorine disinfectant and stored for several weeks before they could cross the Tasman. Hardly fair and hardly economical.

The two academics also assert that the cost of controlling an outbreak of fire blight would be minimal - no more than A$10 million and most likely about A$3m. Given that Australia is due to raise quarantine spending by A$260m this year, it could easily afford any mishaps. "The quarantine regime does not pass even the most rudimentary cost benefit test," the academics say. "Apart from imposing this domestic cost by stubbornly applying a nil-risk policy towards apple imports, Australia also damages its international trade reputation as a supporter of trade liberalisation."

The Kiwis have managed to avoid Australia's intransigence on this issue by bringing their own "jazz" apples over to Australia and growing them there. This effectively makes them Australian apples but the Kiwis at least get a royalty on sales. The Australians are now appealing against the WTO decision but let's hope they will eventually capitulate. Only then can they claim to be playing with a straight bat.