Clarky's Comment - July 2010, Korea FTA

Korea FTA

I joined a senior business delegation to Seoul this month to assist the Prime Minister and MFAT breathe life into the Free Trade negotiations with Korea. These have been stalled as a result of opposition from agriculture interests in Korea. Forestry gets lumped in with agriculture so we are also affected.

We have no tariff on logs sold into Korea but escalating duties of 6%, 8% and 10% on processed wood products. This is sufficient to stop any Korean interest in investing in wood processing within New Zealand.

The combined efforts of our Prime Minister, Korean President Lee Myung-bak and the business leaders has put new life into the FTA. A successful outcome should help encourage Korean log importers to switch some capacity to processing within New Zealand. This would be positive for both NZ forest owners and Korean end-users as we both become less exposed to high and volatile bulk shipping rates.

Safety Matters

On 15th July CEOs/GMs of 82 of New Zealand's largest companies met in Auckland with the Prime Minister John Key and Minister of Labour Kate Wilkinson to sign a personal pledge. See Zero Harm Workplace Pledge.

This commitment by senior business leaders is the culmination of 6 months work by a committed group of NZ business leaders, Department of Labour staff and ACC. Participant firms agree to submit safety statistics into a database that will allow them to see how they are performing against others. The Steering Group is also developing tools to assist CEOs to adopt world best practice in safety leadership. We expect to make a material change to the incidence of workplace accidents and fatalities in New Zealand. For more information see http://www.zeroharm.org.nz

Steering Group members with Hon John Key and Kate Wilkinson following signing of The Pledge

Quality Systems Matter

Remember the early/mid 1990s push by NZ businesses to learn about Total Quality Management and get their Quality Management System (QMS) ISO certified? Most larger NZ firms participated and many forestry contractors adopted the Telarc Q-Base quality system.

While the imperative of having a sticker to say your business has a functioning QMS is not a strong as it was a decade ago, the business case for maintaining a QMS is as strong as ever. At PF Olsen we have taken the view that we will continue external audits of our QMS. External audits act as both a motivator to maintain the system and to assure senior management and directors that we are doing so. See story later on.