CANADA OFFERS ASSISTANCE

Chronicle (Levin), 9 March 1946, Page 7

CANADA OFFERS ASSISTANCE

Press Assn.

LOAN OF £281,000,000

By Telegraph

-Copyright

LONDON, March 7. Canada is making a loan to Britain of 1250 million dollars, or £281,000,000, to be repaid over a period of 50 years after January, 1951, carrying from tliat date interest at two per cent. The Prime Minister (Mr. Attlee) made this announcement in the House of Commons today, after the nev/s had beemreceived of the signing of tlie loan agreement at Ottawa. Mr. Attlee said that both Covernments desired to make constiuctive agreements enabimg the United Kingdom to meet the serious prohlems she mast face after the losses and destruetion caused hy the war. There was an articie, he said, providing for the waiving of interett pay oiencs xn certain defined circumstanotx. EAKLIEE, LOAN The agresmen-c provxded that thc ,nterest-iree xoaxx gianted to Britain oy ^anada in 19 42 wuxud De comcinaeu ^ one same oasid uncxx Jaxxuary x, x»5l. «.ne two u-overnments, beiore that daco, woiud discuss how to treat the service xnd tne repayment of any halance ui me it i±a loau wmcn was tnen oatatanding. I xiie agreement cancelled the j t^.o,vyxU,00o aoxiars indebcecuiess of tLc wiiLuOd Aingaom xor tne Ocmmon--.oa.cn Axr •xxaxning xaan. 'x'ixe two OOveimuenv also agreed to accv.a eacn otuer m ' regard to tm oua-i&e xoncrois and lmpuic restacuom. 1 i.icIiii..iext xxat less lavuarauxe tii .n pj-Owiued ior in any agxeeiuent oiCaOi u-oveinmeiic nas made w.th tne M-vjvoximient oi any ocner country. ivxr. Actiee said oh& agreemeiiu woulo *j.ia ui j ji.icaxxi oO ovorcome i.er bempjr ■try xiiianciai dnflciiicies m purwii^...Cj auui ucxuaa, and coiii/i'ioufce to tne uavoiupuieiit oi tiaae uetvveeu tnt >;ouncj.xes. It would facilitate cue re •iio vai oi trade oaixiers aua wouid aiso tnoviue ior tne lree use of currencieb .or liicei'national trade. These poiicies ..ere in ine vicai unerests of the coun>.iies. xsooii Lo ve.nments believed tney ^au taaen tne essenciai steps for the '•.cpansiuii of world trade.

WAS CLAIMS Mr. Attlee said that iJanada and ' oi.iu.vJui uuu aiso couuudeu a siippio- i ..iOiiuai'y agxeoinenc xor axiaiiging cno ; ..otuciiien'c of an remaining cia.iut j aiiDoxig oat oi tue war ettort of botn : '.^unui.j.es. 'x'liis agieemenc proviaeu j '...au uiie (Jnited Kingdom cancei au | oiaiins on uanada oucscaiiding as ab j xeoruaiy i;b, lexti, and pay wanada iou I iij.ixii.oii uOxiaro. Ocv'nacia v^ouiu. caiicsi j an ine ouisuanamg ciairns 011 tae Jniuea ; n.mgaom not otnorWi.se dealfc witn, m j oludmg the cost of food and other sap- | pnes deiivered hy Canada tq, tne | Jnited Iiingdom hetween VJ-Day aua eoruary 28, 1946. Mr. Attlee conciuded: "I want to exprcss onr cordial appreciation of thc oyiupibuecic approaen to our mutual prouienis snowii by the Canadian Cov j oiiinieiib. x state my conviccion that : .uti agreement will he of great value •••) our common interests. ' ' j lYiore compiete aecans of the agree ' .aonc v.ere made available after Mr ; -xtbiee's announeement uescrimng tne | •iiecuod oi lepayment. The amount oi | -ne ereait drawii oy uecember oi, xt)5x, j • s to be repaid in 50 annuai instal- j ..ieiitfe, begixining on December of tnat i i-ear, witn tne lncerest race oi two pex' j '.eiK. per annurn. 'x'he interest for tne ; year 1951 is to be coinputed on tne | 'uuoanc outstauding at tnat date. In 1 the sacceeding yeais, the interest is to oe compiibCd on tne amount outstand..g at oauuary 1 of eacn year. ^he metnod of repayment in the Bucceeding instalments ioiiows ^9 m sccHiiiuiibb of tne prmcipal repaymencs | and txie lntcrsst snaii oe eifUai aiia ''•jiiCiUtibOi ac tne rate of O,lo2,o\jo •loxlars lor each 100 liiiliion dollars Oi •uedic drawii by j>eceiuocr 31, x95x i The fiftieth annuai instaimeat w.ll ue at bne rate ui u,xo-±,0 d.~ou donars lo. eacn xou miiiioii doiiars. Lach instal.ne.it will consist oi tne xua a,.iuuu. oi cne interest dae. x.ie reniaindci will oe pnncipai to oe repaid. 'i'hese ^rovisjons aiu s.n-j'^nb bj bne pi.Ovioiu.i„ ••0 waive paymcut. WAIVING- 01' INJEKEST Canada agrees to wai.e tne inierest •u cnc xoilo ..■ing conditions: — Uj Ti Britam mias a waiver lieeeosary in "vicw of thc existiiig and p^.^ tJtixCivo conditions of mternacionai -.a^uaiibe and tae levci of Lribai.n s go.u and foreign rescrves. v2; xi biiC xiitebuational Monetary c'uad cercihcat-JS cnat eoiuc in.x b..^ United Kingdom from home proaucou ttnx.orcs, piuo tne net lno.nne ixoai 111visibie current transactions, is on an average over the iive preceding years, less tuan thc average annuai ainoant oi Britain 's lmports from 1936 to 1958— tnis average figure was fixed at E8b6,000,0d(J subject to adjustments for ehanges in price 'evels.

(3) If the interest payments are waived on any credit to the United Kingdom to which a similar waivei provxSion applies. The Governments in addition agree to eousidsr wuac cuanges tliey v/in maxe in the piovisions for credit ll v. ere is any major.change in the mteruationai liuanciai situation maceriaily .uectmg the prcspective benefits and obligatiuns. Aithougn the text of letters between Mr. llsiey (tne Canadian finance Minister) and Dr. Dalton (Chancellor oi the ilxc-iequer ) , reieased today, ailirms the understanding that the non-discrim-inatory trade ciause, also the clause relatmg to the 1942 interest-free loan, and the air training plan clause, will not he implemented until it is known tnat the A..ierican ioan is approved. A high London financial expert stated that the Canadian iniplementation of thc loan agreement would proceed before the Congress decision. The loan reauires ratification hy the Canadian Parliament, but not the British, and is effective from the moment

.t is approved by the Canadian Parlia ; ment. I —