EXCHANGE AND TRADE

Hokitika Guardian, 20 May 1920, Page 4

EXCHANGE AND TRADE

UNITED STATES AND NEW ZEALAND.

AUCKLAND, May 14

When a state of virtual crisis was reached last January in the import trade owing, to the figures quoted for exchange on America, the opinion was freely expressed tliat- the ultimate result would be the swing of the peiuitifmil. in favour of the British uianul-.c-\urcr and exporter as far as supplying A'ow Zealand’s requirements Avas concerned. Though, the exchange rate has recovered to a certain extent, it remains suiliciently low to exercise a considerable influence upon the prices u. imports from the United States. An Auckland business man, win/deals in a number oi imported lines, particularly hardware, stated in an interview that a considerable diversion of orders to British firms, had taken place in such volume that the manufacturers were entirely unable to cope with them. It was not possible, consequently, that the oppoitunity for British trade to regain its grip could be seized as fully as wouid otherwise. have been the case. lm\ movement, nevertheless, had made itself, felt'to the extent oi inducing numbers of exporters in < : tho Uniteu States to quote special discounts for tlie export trade in order to meet the exchange problem. For these reasons, he continued, it was to bo regretted that the British houses were faced with a much greater volume of orders than they could possibly deal with. The extent to which trade had already been diverted had undoubtedly had some influence in the subsequent rise in exchange. Had the British firms been able to fulfil more orders the results would doubtless have been of advantage both to British and New Zealand trade. For some time after the war, l.owev.ei, many British manufacturing houses were turning out iess than 40 per cent pf their proper output, and in some cases actually less than they had produced daring the war. Labour troubles, coal shortage, and all the disturbing factors incidental to the early after-war period had contributed to this result, consequently *• they were left with a heavy legacy of back orders to fulfil. They took new ones so far. as they could, but beyond a certain point there was not much chance of delivery. -N° only had this amount oi lost ground to ■be made up, but there was 'also the matter of new demands upon the resources of the manufacturer consequent upon the need of all sorts of material on the Continent, and also the great demand on the British market itself. There was one occasion ■continued the importer, when he was complaining to a British firm of the delay in the lulliilment of his orders that the reply he had received was that had not the firm in question decided to set aside a certain amount of its output tor the export trade, he would have received nothing at all. Had he so desired, said the manufacturer* he could have sat in his own office and sold all that his business could produce without sending out a single traveller. The desire to keep up his connexions abroad had induced him to allot a certain amount of his output for the export trade, and this was the only reason why the New Zealand buyer was able to obtain any goods at all. Shipping, said the importer, had improved, and u&s continuing to improve. Other things being equal, ho 'continued, his experience showed him that an undoubted preference existed in New Zealand for British goods, ns against the American, as the price undoubtedly was a 1 factor in governing the demand. Not only did the general public-prefer the British,article, but bought it even when it was a little dearer. ,