EFFECT OF EXCHANGE

Evening Post, Volume CXII, Issue 87, 9 October 1931, Page 6

EFFECT OF EXCHANGE

GOODS FROM ABROAD

QUESTIONS IN THE HOUSE Information was sought by members of the House of Representatives last night as to the effect of the alteration in the exchange rates on certain goods coining into the Dominion from various . sources. Mr. C. Carr (Labour, Tiniaru), asked whether the method of calculating the value of wheat and flour imported from North America, as referred to in the Press recently, would affect tho sliding scale of duties, and if so, in what manner and to what extent. - The Minister of Customs (the Hon. W. Downie Stewart) said that the pur-chase-of wheat' and flour from North America might be affected by the fact that the New Zealand currency was depreciated in comparison with American money. ' That being so, it took more New Zealand money to buy goods' in North America, therefore tho landed cost of the goods in New. Zealand would be higher. Under the sliding scale of duties, the duty was lower as the price became higher. He did not think the change in the method of computation made any differonce, because, under the sliding scale fixed by Parliament there was a maximum duty, and ho understood the position was not affected by the change-over to the bank rate of exchange. Had the change-over not been made, then tho adding together of the price and the duty would have raised the total price to a higher figure than the maximum allowed by Parliament. Tho change in tho method of computation therefore made no difference under tho existing circumstances. TOBACCO IMPORTATIONS. On behalf of Mr. G. C. Black (Independent, Motueka) Mr. J, S. Fletcher (Independent, Grey Lynn) asked the effect of the present exchange rates on unmanufactured and manufactured tobacco imported from America in relation to landed prices, in New Zealand; the effect of the "exchange rates on manufactured tobaccos imported from Great Britain and Ireland in relation to landed prices in New Zealand; and the effect of the exchange rates on manufactured tobacco imported from Australia in, relation to the landed prices in New. Zealand. Mr. Stewart replied that tho same principle applied in answering Mr. Black's question as in answering Mr. Carr's, except that there was no sliding scale to be considered. In respect to importations from America, if the New Zealand currency waß depreciated as compared with American currency, the landed cost of the goods in New Zealand would be higher. As regarded importations irom England and Ireland, the same principle applied. In respect to Australian importations, the converse applied, and the landed cost in New Zealand would be less. Ho added that as tiino went on, where currencies were depreciated the internal prices might adjust themselves to the. external conditions.