PROTECTION OF RESERVES

Press, Volume C, Issue 29503, 3 May 1961, Page 19

PROTECTION OF RESERVES

“Credit Control Slow To Act”

(N.Z. Press Association) WELLINGTON. May 2. There was no doubt that credit controls through direct restriction of bank advances could be supplied severely enough to correct any internal inflation and eventually curb the demand for imports, said Mr C. R. Larsen, a member of the Board of Trade, in an address to the Wellington branch of the Economic Society. However, the experience of 1955-56 showed that until they were intensified severely these controls took a long time to become effective and were such a blunt instrument of control that local industry. including farming, felt them long before imports were reduced. Mr Larsen said. Mr Larsen added that the current situation was a little different and a selective squeeze might be possible for a while without hurting production. There could be little doubt that a substantia] amount of stockpiling of imports was taking place at the expense of New Zealand’s overseas reserves.

Tariffs, compared with import controls, were now widely accepted as being a preferable means of protecting local industry from un. fair competition. They were, however, no substitute for hnport controls in safeguarding overseas funds, Mr Larsen said.

N.Z. Paper Mills.— The directors yesterday recommended payment of a final dividend of 4| per cent. This makes, with the interim dividend paid last November, a total of 8 per cent, for the year ended March 31. This dividend payment is made on the increased capital of the company.—P.A. Overdrafts Up.— Advances and discounts by trading banks in New Zealand totalled £ 238.9 m on April 12. This figure shows a rise of £5.6m in a week. £7.6m in a month and £ 52.8 m in a year

Personal.— Mr Warren D. McDonald, chairman of the Commonwealth Banking Corporation, has accepted an invitation to join the board of Imperial Chemical Industries of Australia and New Zealand Ltd.