WELLINGTON NEWS

Hokitika Guardian, 1 April 1930, Page 2

WELLINGTON NEWS

DOMINION’S TRADE

(Special Correspondent.)'. WELLINGTON, March 29.. With the release of the export and import for February we are in possession of tlie aggregate for five months of the?, current produce year. It is perhaps desirable to explain that commercial houses and the Chamber of Commerce regard. September as the close of the year, for although the mainly ibe-

gin operations iii,.,,August new season’s dairy produce: does not begin to Heave the DSmjjniou until October. Taking the fijtef'inonths. to the end of February thdVexports amounted to £21,926,973 with £27,026,568 in corresponding five months of season; there was thus ;a f(stiiraction of £5,098,595 or an over £1,000,000 Per month. Thal'das tlie",l-loss of income that we have suffered .. in the short Sjpacc of five, months and there is no indication that the., prospects will improve, on the contrary the prospects are that the shrinkage in exports will continue to expand. Furthermore it is obvious that the values placed on exports of dairy produce in particular in the months of' October, November and December and which have been marketed since the fall in values do not give a true idea of the value of our exports. On the other hand wool is being held off the market ■ and that has materially reduced the total. The exports are in a chaotic condition and it is necessary to be very careful in drawing conclusions. The fact remains however that for the first five months of the export season wo havo gone back at the-rate of a million a month. The imports for the five months under review, amounted to £20,602,413 as compared with the; corresponding period of the previous, trading yelpy. an increase of £760,008. .Thus while our income from’ overseas had ,declined by over £5,000,000 our indebtedness'ovei-js-eas increased. Is it any; cwonder that the banks are making 'the/:' position difficult for importers? Our. position. is not . nearly so. unsatisfactory when compared with Australia '.-hut that is poor consolation. For the six years ended June last imports exceeded exports by £42,000,000 in Australia. In the same period the Commonwealth had to pay overseas for interest £193,000,000, that is a net total of overseas of obligation's • of £235,000,000. In the same' peripd Australia’s overseas debt increased bv £153,000,000. Including £9,000.000 received overseas in respect to Bawra distributions ibis gives a total of £162,000.000 received in London payments towards meeting her obligations. Even in that short period Australia had created a further adverse balance of not less than £73,000,000. The exchange position Australia on London is exceedingly acute and that is shown by the further increase in the rates as announced earlier in the week. Telegraphic transfers from Australia are now £6 IDs per cent having been raised in tlie course of a fortnight by £2 7s 6d per cent'., But this high rate is only: nominal for the banks on the other, side are drastically rationing demand for overseas money. When the previous increase was made by the Australian Bank and the telegraphic rate was raised to £4 2s 6d per cent tlie New Zealand banks delayed action for .a week and-then only raised , the rate by 10s per cent, the telegraphic transfer rate being brought up to £3 12s 6d per cent at which it stands at present. There is a big difference between this fate and £6 10s per cent and the disparitv is not likely to exist very long. The Associated Banks of New Zealand are bound to raise the exchange rate and it is difficult to see how they can avoid doing so.\ The current year promises to be 0 very trying one ,for Australia ancl New Zealand, and both countries must cultivate a wholesome respect for economic laws, indeed they will be forced to . do so by the trend of affairs. The dead weight of unemployment will' not be lifted with palliatives or py hopes of prices of produce recovering’. Tlie fall in the level of commodity prices lias a deep seated * cause in. the gold problem, and the fall is iir'a.ceotdance with the opinions

of the leveling economist? of the world. We know the causes that have led Tip ‘tc the present disagreeable position and the time has arrived for applying remedies. A necessary would be to reduce the (■ 'st of production, which in turn would bring down the cost of living, leaving real wages little affected. High wages are a desirable factor, but as Sir Henry Braddon has said, the Arbitration system has made of the worker a tricky litigant. Australia and New Zealand are debtor countries and sit all times our exports must exceed our imports, and by a substantial amount. An exporting debtor country cannot have its internal level /of prices without meeting trouble. "’ Our exports bare 'been steadily declining in value over the past twelve months and yet the cost of production remains at the same old hiulV Tevel and we wonder why there is so much unemployment. It is often suggested that there should be exercised public and private eOnomv and one innocent individual had a letter in one of the papers desiring, to know p’hcther a man wanting his house feted or a farmer wanting some . fQOf.i »g s,l0 " 1<1 frf > m ™. ot ' ives of-economy postpone such. I Ins class of work would be put in hand promptlv were it not for the fact that, under award wages and conditions it too expensive. But there is room for economy in living. Tf 1™ were sp% on pictures, stadiums, dirt