BARTER SYSTEM

Gisborne Herald, Volume LXVI, Issue 20132, 29 December 1939, Page 12

BARTER SYSTEM

NOT SATISFACTORY S. AMERICAN TROUBLES BUENOS AIRES, Dec. C. Several South American republics are completely disillusioned by their experiment in barter with the totalitarian States, and are seeking an opportunity to return to the multilateral system in international trade. Some of them have become so involved by their bilateral agreements that they plan to establish the quota system as the first step towards their release. In some cases, notably Uruguay, the authorities wish to enter into new trade agreements with Great Britain and the United States, without involving reprisals from totalitarian countries.

Germany supplied 20 per cent of Uruguay’s imports, Great Britain 19 per cent, the United States 4 per cent. Great Britain took 17 per cent of Uruguay's exports, Germany 10 per cent, the United Stales 0 per cent.

Uruguay claims that the barter system has developed into a stranglehold, iiaiy, for example, increased the price of jute 25 per cent overnight, after signing a barter agreement with Uruguay. Similarly, it was stated in Montevideo, Germany sold many products in Uruguay at prices 10 to 15 per cent higher than German traders cnarged for me same articles in Argentina.

On the other hand. South American countries have been compiling useful revenue from profits in their dealings in foreign exchange under arrangements set up in the bilateral agreements. In Argentina and Uruguay these profits averaged 25 per cent on all import trade. Representatives of Finance Ministers have been taking a prominent part in negotiating new trade agreements and wish to maintain these profits. To this problem they would like Great Britain and the United States to find an answer.