An economic assessment of the middle class and upper class market in Malaya as a potential outlet for New Zealand meat and dairy products

Abstract

It is only recently that the need for New Zealand to find and develop new food markets has become apparent. Up till then, her established markets, mainly the United Kingdom, have been able to absorb all the food products she produced and to pay the price she expected for them. In recent years, a number of adverse developments, mainly in the field of international trade, have made it necessary for New Zealand to re-examine her traditional trade pattern and to consider seriously, the prospects and problems of developing markets in Asia and other underdeveloped regions of the world. These adverse developments are: (a) The increasing tendency of developed countries to adopt national agricultural support policies, which aim at maintaining domestic farm price and income at levels higher than would otherwise prevail and which imply higher costs and obstructing imports. (b) Virtually all the established markets for New Zealand's food produce are found in the high income countries where food consumption per head is reaching a relatively high level both in quantitative and qualitative terms. (c) There is an increasing possibility of the United Kingdom entering the E. E. C. in the very near future. One of the countries that New Zealand is showing increasing interest in recent years is Malaya. Her thriving economy, friendly government arid the gradually changing tastes of her consumers are attractive attributes to a food exporter like New Zealand. The main purpose of the present study is to shed some light on the nature of a particular section of the Malayan market, namely the middle and upper middle class market for meat and dairy products. In developing the new market in Malaya, it is extremely important to recognise the fact that there is virtually no one single market serving the whole population, but in reality three distinct markets, depending on the standard of living of the particular section of the people. This is so in practically all underdeveloped countries where there is a great disparity in the distribution of wealth and hence living standards. The three markets are: (a) A relatively small group of consumers with a great deal of wealth. This group provides most of the purchasing power particularly for the better quality goods and luxury items. (b) A second group consisting of the great majority of the population whose purchasing power is extremely limited and this is spent on absolute necessities. (c) The third group – middle and upper middle class - has a living standard in between the above two extremes. In general, it is fair to say that it is the third group which will provide the main market for New Zealand products in the present, as well as for the foreseeable future. However, in the very long run, it is the market below this level, namely the group making up the great majority of the population, which is important, and the rate at which this market could be developed will of course depend on the rate of economic development of the country as a whole.