THE GOVERNMENT LOAN

Dominion, Volume 9, Issue 2612, 6 November 1915, Page 4

THE GOVERNMENT LOAN

Applications for the Government two million loan at 4i per cent, close to-day, and according to tho Finance Minister (Sin Joseph Ward) there is no doubt about the issue being covered. There is every reason to believe that the Minister's forecast will be verified. Beyond publishing the details of the issue, no special efforts have been made to whip-up subscriptions, and this further tends to emphasise the confidence of the Government in the success of the loan. It is a- loan that ■should commend itself to investors of all classes, for the terms are attractive. The rate of interest is 4i per cent., and the period of tho loan may he determined by every applicant for himself, for the debentures will be repayable at 5, 10, 15, 20, or 25 years at tlio option of the applicants, and the subscriptions may bo £o or any multiple of £5. The debentures will be made payable to bearer so that tfhey may lie transferred from one to another practically as bank-notes. Coupons aro attached to tho debentures, and this makes the collection of the interest a simple'affair.

The issuo is not strictly a war loan, but it will help to relieve the pressure on the London money market, and to that extent we are assisting the Empire. Tho money is required for public works purposes, and though tho prosecution of such of our public works as will directly assist the further development of our natural resources and lead to the expansion of our primary industries is highly desirable, the Government will require to handlo the Public Works Fund judiciously in view of the present state of the world's money markets. The ability' of New Zealand to finance this loan is beyond question. The trade figures of the country are impressive, and show a substantial balance in our favour. Thus the exports of New Zealand for the year ended September 30, the'true produce year, totals £29,710,434, as compared with £23,759,347 for tho previous twelve months, showing an increase of £5,951,087, which may he said to be directly due to the war causing prices of wool, meat, butter, cheese, and other products to become inflated. The imports amounted to £19,780,224, as compared with £21,056,384, exhibiting a shrinkage of £1,270,100, which is also another direct effect of the war. The excess of exports over imports for the year ended September 30, 1915, is £9,924,210, which is an exceptionally large amount. Of course, the whole amount cannot be taken in as a credit balance, because _ wo must deduct from it our foreign or overseas obligations, such as tho payment of interest on public and private indebtedness abroad, the provision for remittances to Egypt, Malta, and England on account of the war, the payment of dividends to shareholders of New Zealand joint-stock companies resident abroad, and tourists' letters of credit and other similar obligations. Providing for all this there is still a. very large balance left, and, further, we aro at tho opening of another season, the profitable character of which is assured. Thus the. people can easily find the £2,000,000 which the Government requires, and we agree with |the Minister of Finance that tho money will be forthcoming.