CAN JAPAN AFFORD A LONG WAR?

Hawke's Bay Herald-Tribune, Issue 197, 6 September 1937, Page 6

CAN JAPAN AFFORD A LONG WAR?

The Japanese Government is to put into operation a plau for foreign trade control, prepared earlier in the year. The reason given is the increased growth of the adverse trade balance. In the first four inontbs of 1937 this balance was 390,000,000 yen, or more than double that for the corresponding period of last year. Correspondents in Tokio, commenting on this fact, said that it showed clearly the extent to which the Japanese depended upon foreign supplies of raw materials, and as it is now proposed to restrict ^imports of cotton) wool and gieneral goods the position of the exporting industries will be threatened. Some of them, 110 doubt will be changed over to the inanufacture of inunitions, but even then thcre will be diificuities. Alr Maro T. Green, one of the bestkuown American correspondents, in a recent article, said that despite Japan's heavy purchases of iron and steel, the shortage was so acute that 20,000,000 yen worth of commercial and general constmction work had had to be abandoned} because the inilitary establishments required all the supplies avaiiable. The economic weaknesses of Japan have been set out as follows; I'he oiiiiuous financiai position due to an uufavourable trade balance, ' heavy debt burden and excessive taxation. The destiuction of foreign trade consequent upon a large-scale war and tlie physical condition oJ the peasantry, owing to privations caused by the longi depression. A cabie tnessage during last week stated thatj in the opinion of the leading banker, Japan could finance a long carnpaign, but if there is an adverse trade balance the fiiymcirig oi purchses abroad will present difficulties. The position would beeome desperate were the United States Government to apply tlie provisions of its Neutralily Act, ioi that is said to be the only country where tlie Japanese have any largie reserves. Tliey were creqted wlien, some time ago, the gold holdings were te-valued. Very little has been heard about the attitude of the Japanese people with respect to the latest armed adventure in China, but a country so dependent on foreign trade and 011 foreign supplies oJ raw materials, will have acute problems to face il the war is at a-11 prolonged.