GERMAN NEWS.

Hokitika Guardian, 10 April 1924, Page 3

GERMAN NEWS.

GERMAN CAPITA I

REPORT OF COM-MITT ICE. [llkotehs Te/.eokams.’J (Received this day at 11.25 a.m.) PARIS, April 9. TJio report of the McKenna committee into the flight of Orman capital estimates the value of German capital abroad, at the end of last year, between 5700 and 7800 million gold marks making with half a milliard foreign money held in Germany, a grand total of eight milliards. The report states that the principal method of acquiring foreign capita! was the negotiating of paper marks abroad, and declares that inquiries at the principal German hanks assisted liv chartered accountants, show ~ that Germany, thus made a nett profit of seven to eight milliards. The report enumerates other methods of export of capital, like the sale of merchandise, securities, bullion, and bills df exchange. Tn order to stop the flight of

capital, the report recommends the abolition of the cause; namely the definite cessation of inflation. It attributes lh flight of capital principally to the failure to balance the budget, causing capitalists to translate money into forei ’ denominations, in order to avoid loss through depreciation of their currency. The report declares the flight was accentuated by the attitude of the German people towards the payments Germany was called upon to make to her war creditors. The Committee refers to the recommendations of the Dsv.os Committee for establishing Germany money oil a stable foundation, thus facilitating the return of a large amount of German wealth now abroad to ordinary commercial channels. It proposes that for the period of transition, persons liable to penalties under the existing law should be pardoned and an advantage offered to Germans to subscribe to loans in foreign currency.

THIS DAWKS' REPORT.

[lf RUTEIiS Tlir.Hr.HAM9.]

{Received this (lav fit 12.23 p.rn.) PARTS, April 9. The Officisi 1 Dawes Committee's report with regard to measures necessary to haiaace tlie German Budget, and stabilise the currency, while recognising that the political considerations ret certain limits within which a solution must he found if it is to have any chance of acceptance, emphasises that the committee has been concerned with the problem of debt recovery, and not an imposition of penalties. As business men they consider ii hopeless to build up any constructive scheme, except upon the basis of good faith, all parties carrying it out. Such a basis, the committee concludes. i» not: the method of balancing the German budget, temporarily or permanently. under the present limitations ol Germany’s fiscal and economic rights OV er part of her area. They are therefore compelled to base the reports solc]v on the hypothesis that the fiscal and economic unity of the Reich will be restored.

'l’ll,, experts emphasise that their forecasts arc based on the assumption that economic activity will not be hampered by any form of control or organisation other than provided in the scheme. All the existing measures me hampering such activity, and consequently should be withdrawn as soon as Germany has taken positive steps towards a plan, such as establishing machinery whereby the assigned revenue would flow through Allied control. Such measures should not he reimposed except in the case of flagrant failure when creditor Governments should determine the nature of the sanctions. 'Phe Committee propose the estab-

lishment: of a now bank in Germany or tbo reorganisation of tlie Rciclisbank as an essential agency for creating a stable currency.