THIS YEAR

Dominion, Volume 20, Issue 52, 25 November 1926, Page 12

THIS YEAR

“MOST FRUITFUL SINCE WAR”

REVIEW OF PAST AND PRESENT CONDITIONS

BETTER UNDERSTANDING BETWEEN NATIONS

The eight years since the declaration of peace has been a period of convalescence, slow, difficult, and painful. The year 1926 has proved the most fruitful of the eight, in bringing about that better understanding between the nations of the world so necessary to the development of peace, good-will, and healthy trade relations.

This statement was made by Mr. A. H. Mackrell (Invercargill) in the course of’ his presidential address at the opening of the New Zealand Chambers of Commerce annual conference yesterday. Mr. Mackrell said that amongst .the onstanding events of the year or a little more were: The formal signing of the Locarno Treaties in London; the progress made in funding the interAllied war debts; the return of Britain to the gold standard; the Imperial Conference just concluded in London; and the regrettable and tragic coal strike in Britain. The Locarno Pact ottered the prospect of European peace for some vears to come. Even if the highest hopes could not be built on it, the treaties demonstrated on the part of the nations concerned a new attitude towards international affairs, and prepared the way for further efforts towards the real and permanent peace so devoutly desired by all. American Foreign Loans.

“Eleven nations have reached agreement with the American Debt Funding Commission on the basis of payment of their financial obligations to the United States," continued the speaker. “The total indebtedness of Europe to the States is estimated at about 2470 millions, of which 1520 millions have been dealt with, the balance being owed principally by France, whose debt is about 864 millious. Progress has also been made by Britain; provisional agreements have been reached with. France and Italy. “The settlement of these difficult questions is another step toward the return of normal conditions, and, although it is only one step, and there are many more ahead, yet it is a sign of progress. Oiie result has been the tremendous increase in foreign loans made by tho United States. Whereas in pre-war years tho average was 11 millions per annum, iu 1924 the States lent 197 millions, and in 1925 245 millions. In pre-war days, Britain’s foreign loans were about 160 millions per annum, but in 1924 and 1925 they fell to 124 millions and 77 millions respectively. There are implications in these debt settlements which cannot yet be seen, but the reinvestment abroad by the United States of surplus capital, which threatened to choke it, must be regarded as a favourable sign."

Britain’s Financial Position.

In connection with the world’s war debts, Mr. Mackrell mentioned that Britishers the world over were surely filled I with pride at the manner in which Britain, despite her stricken industries, depleted manhood, and almost unbearable taxation, "the awful legacies of her great part in the war," had discharged as it fell due every penny of her indebtedness to America, and had not only not sought to escape her own, but had actually borne other nations’ responsibilities in that direction, where she might well have beeu justified in declining to do so. , ~ “The return of Britain to the gold standard was an inevitable but none the less bold and heroic step,” the president added. "It involved changes which ‘have not yet been adjusted, but was another stage in the restoration of those pre-war monetary conditions which promoted international and world trade.’ "Tho strike of the coal miners has thrown Britain back on her haunches, from which it will take many months, and perhaps years, to recover. It is not for us to criticise or suggest the rights or wrongs of the strikers, or upon whose shoulders the fault lies, but we <lo know the strike has cost Britain alone hundreds of millions of pounds, and is also having a very marked effect in lowering the value of the primary products exported by us to Britain, and upon the manufactured value of which our prosperity and welfare is so dependent. The strike is happily drawing to a close, and we can only earnestly hope that the boom in trade in Britain which is predicted, will, for our own and Britain’s sake, soon become an actual fact.” Exports and Imports. Turning to New Zealand affairs, Mr. Mackrell said that the past year had witnessed a serious reverse of rhe balance of trade. For the first time in more than twenty years, the value of our imports exceeded the value of our exports, and that difference. together with the annual interest bill on foreign loans, totalled somewhere in the vicinity of twelve million pounds. The trend of values of exports this year pointed to an equal or even larger deficiency unless importations were greatly reduced. Just how long that state of affairs could go on and the country remain solvent, was highly problematical. Cheap Land Farmers’ Salvation. "Land in recent years went far beyond its true value," said the speaker.

"and there must be a substantial and early reduction of these values before fanning can be made attractive and profitable. There is much talk of cheap and abundant supplies of money from farmers’ banks or other sources to overcome the difficulties of the farmer today, but all this will be of no avail until land values recede and the cost of production is brought to a point to allow us to compete profitably in the world’s markets. If this cannot be done, we then cannot survive as a country dependent upon primary products alone for its prosperity. Aid From Science. “Science can nnd is helping us. Increased production, more intensive cultivation, closer settlement, high quality in our products, will all assist, and a period of lean times will do much to force us to realise this, but we also need capital for this purpose, and that capital should bo available from the profits of the land rather than borrowed. Our present difficulty in this direction is that banking and other financing institutions are disinclined to lend where values representing their security are too high, and the profits being made from farming are not sufficient for the application of scientific farming methods. Even it these difficulties can be readily overcome, are we wise to continue 'only as a country producing what is known' as primary products and raw materials? No country can develop rapidly by the production of raw materials or primary products alone. Relation of Primary and Secondary Industries. “This brings me to a point where, I believe. New Zealand must seriously and 1 earnestly consider the importance and relation' of what are termed secondary industries to our primary industries, and the continued expansion and growth of the Dominion. "We all support bv expression if not in practice, the slogan ‘Buy British Goods.’ If we are sincere in the application of this slogan, we will buy first, goods made in New Zealand. For NewZealand made goods are British goods. If we cannot buy New Zealand made goods, then let us buy goods made in some other part of the Empire When we buy New Zealand made goods, we help to keep some one in employment in our own country, and every man wo can employ in industries in this country will be a purchaser of our primary products’.”