WORLD DOLLAR SHORTAGE

Ashburton Guardian, Volume 70, Issue 106, 17 February 1950, Page 3

WORLD DOLLAR SHORTAGE

REPORT BY UNO COUNCIL INTERESTING SURVEY (N.Z.P. A.-—Copyright) (Rec. 10.30 a.m.) GENEVA, Feb. 16. The United Nations Economic and Social Council to-day forecast a growing world dollar shortage ,and continuing economic difficulties for Europe and* part of the British Commonwealth. In its report for 1949, the council secretariat states that the strength of factors which had so far tended to promote economic expansion throughout most of the world had been cnsiderably reduced. It desci’ibes the unfavourable balance of Europe’s trade as “chronic.” The report takes Australia, Canada, the United Kingdmn, France, the Netherlands, Norway, Sweden and Denmark- as a gj’oup to which 1949 brought a substantial reduction of inflationary pressure, higher levels of economic activity and no increase in unemployment, but the rate of industrial production slackened “perceptibly.” In Australia and the Netherlands, the report says, the increase in the cost of living was greater than in other countries, and real wages may have fallen somewhat.

The report considers the different economic areas separately. It finds: (1) An increased cost of living in Australia and the Netherlands; (2) a de. crease in effective demand and increased unemployment in the United States; (3) an increase in real wages in Canada and France; (4) “a substantial decrease in. inflationary pressure” in Australia, Canada, Denmark, France, the ■Netherlands, Norway and Sweden, and the United Kingdom; (5) a considerable rise in unemployment in Belgium and the Western zones of Germany; (6) serious unemployment in-Italy; (7) a reduction of inflationary pressures in the Middle East; (S) a notable reduction in the value of Latin America’s foreign £rade. Only about Eastern Europe, is the report unequivocal. It says: There was a substantial increase in industrial production and in the supply of food and other consumer goods, and real income rose.” The year is described’as a year or “major economic changes” marking the virtual comletion, of the post-wai peiiod of reconstruction and reconversion.

t Measure of De-rating Countries with controlled economies were able to permit a measure of derating and de-control. Post-war inflationary conditions ended first of all in the United States. In August, 1949, the United States had 3,700,000 unemployed and partial unemployment amounted to 2,300,000. After referring to the increase in industrial production in Eastern Europe the report 'says of the Soviet Union: “Sales expressed' in constant P nc ® s were 20 per cent, higher than in 1948. This improvement in supply was accompanied by a major reduction in prices. The average real income of salary and wage-earners increased by 12 per cent.., and the average real income of farmers by 14 per centJ