WELLINGTON NEWS

Hokitika Guardian, 9 March 1929, Page 2

WELLINGTON NEWS

RURAL CREDITS row. [Special To The Guabdian 1

WELLINGTON, March 7

In urging the establishment of increased rural credit facilities, farmers and settlers, both here and elsewhere are disposed to believe that they will be able to obtain money at particularly cheap rates. They overlook u*e facts that institutions providing rural credits have to be run on business lines. In Great Britain the demand for grea.t financial assistance by the farmers resulted in the formation of the Agricultural Mortgage Corporation under the provisions of the Agricultural Act, 1928. This organisation commenced operations on January 14th last. The shareholders in the corpora, tion, of which Sir Harry Goschen is the chairman, are the Bank of England and all the leading stock banks in England with the exception of the Midland Bank. The terms on which longterm credits are granted to farmers and landowners include loans on mortgages of agricultural land not exceeding two-thirds of the value granted for periods up to 60 yenrs and repayable by equal half-yearly instalments covering interest and repayment of principal. For a6O year loan the rate of halfyearly repayment is £2 15s for each £IOO for the full period of the loan. Loans for improvement of land will be granted to landowners subject to the approval of the Minister of Agriculture for periods up to 40 years, £IOO being repayable by 80 half-yearly instalments of £1 each to include principal, interest and all charges other than those made by the Minister of Agriculture. It is doubtful whether the provision mad,e for long-term credits on the basis announced could be regarded as likely to assist British agriculture to recover appreciably from its present ills. It cannot be said that the corporation’s terms represent particularly cheap capital for agricultural development, as on a 40 years improvement loan the annual rate of interest works out at oi% is the opinion of the “E'conomoist” London, and this paper declares that the manifold difficulties and shortcomings of the agricultural industry are too great to be readily overcome by the establishment of facilities of borrowing for long terms at rates not strikingly lower than those charged on ordinary business loans. During the las four years there has l>een considerable agitation in the Dominion for.long term loans and rural credit associations have been formed in many places and other facilities have been provided for borrowers, yet it is surprising to find that during the past three years there has been a great falling off in the amount of the mortgages registered. For 1925 the total was £47,360,181, in 1925 the amount had fallen to £42,054,927, in 1927 there was a further sharp decline to £33,934,709, and last year there was a drop to £32,750,469. Thus since. 1925 there has lieen a shrinkage of £14,609,712. No doubt stricter valuations are in some measure responsible, nevertheless the figures are interesting and are worth investigating.

PECULIAR CHINA.

While politically speaking China is a. mass of confusion in other respects it unostentaciously makes consistent and often remarkable service. Even in so conservative an industry as agriculture astounding developments are reported in connection with the use of electric power and fertilisers. English merchants first introduced chemicals into the country about 20 years ago, but it is only since the European War, and after propaganda by the Agricultural experiment stations, that they have been resorted to on anything like a general scale. Now large quantities are imported, and British, German, American and Japanese companies compete actively for business under picturesque banners that infues poetry even into phosphate of ammonia and nitrate of soda. .

Imperial Chemical Industries (China) has virtually a monopoly of the English part of the trade soliciting custom under the “Crescent” brand. It is the best seller i.n two important provinces. The German sign is the “Lion and the Horse,’’ the American the “Nine Buffaloes and Two Tigers” and the Japanese the “Double Dragon.” The rivals of Imperial Chemical Indust, ry appear to have their competitors beaten in the matter of titles and it is a fine tribute to the exceflence of the British product that it should hold its own so well in face of the attack of so formidable a menagerie. New Zealand has been frequently urged to endeavour to open up trade with the Far East and some day no doubt something will be done in the matter, and it would be all to remember that excellence of brand is a strong attraction in the East.