WELLINGTON NEWS

Hokitika Guardian, 23 July 1931, Page 5

WELLINGTON NEWS

MOMENTOUS MEETING.

(Special Correspondent)

WELLINGTON, July 20,

The world crisis has been brought to a head by the condition into which Germany has been forced by circumstances over which she has no control. Germany has been unable to pay reparations and that in itself has created an abnormal state of affairs in that country. 'Europe and confidence have been wrecked, there has been a flight of capital from Germany calling for drastic measures. It can be said that Germany has done her best from the commercial standpoint to keep things in order. As the London “Times" observed : "The conditions in the country are far sounder to-day than those which obtained at the time of inflation. Industries, though depressed, like the industries of other countries, are on a sounder basis, the balance of trade is favourable, and thanks to, the courageous policy of Dr Bruening, the Budget of the Reich is in balance. This is the positioned Germany at the present moment and her position is not hopeless. Bile needs a large loan, about £100,000,000, and all the interested nations, and particularly the . United 'States and Great Britain are willing to help in providing thfe amount. France, the other great creditor country, and the chief beneficiary of reparations, is willing to precipitate in the loan and as the “Times” ooserves, the only obstacle is the political intrausigeance of French. Government, which is responsible for the present crisis and the expansion of its area, The intrusion of politics in a grave economic problem is regrettable and the more one views the political demand of France, the less can one see for their reasons. France wants Germany to postpone building a “pocket” battlesh’p and to denounce the German-Austrian Customs Union. With respect to the latter, Dr Bruening agreed to submit the matter to the Hague court, and surely that ought to" have satisfied France. With respect to the military demands they appear to be almost childish. France is the greatest military nation in Europe to-day. .She has about 600,000 men in arms while the German establishment is limited by the treaty .to 100,000 or barely enough men to police the country. Furthermore, France has entered into a military alliance with Poland, which offers further safety to France. Germany's navy is travistv. She is at the moment incapable of , making any kind of hostile demonstration, at least against France which to-day possesses as large a navy as Britain. When one considers this it certainly becomes very difficult to understand France’s demand for “political appeasement." Germany cannot be allowed to sink, for in point of fact the world cannot do without the trade of Germany. One trouble from which the .world is suffering is that Russia, China and some Eastern countries are not pulling their full weight in world trade, Ski far as New Zealand is wmcyrnetl it would he to our advantage to see Germany in a sound economic position, buying from and selling to other nations. Germany is a buyer and consumer of crossbred wool, and in the past Germany's wool purchases have been very helpful to us. and we want that state of affairs to continue. There can be very little doubt but that the momentous meeting in London on Monday will have devised some reasonably sound and practical plan 'succouring Germany. To allow her to crash just now would be to crush the world with another crisis from which even France could not escape. But for the intrusion of politics by France the crisis would have been overcome, for bankers have seen the need of helping Germany. The Bank of International Settlement was prompt with awl, and towards last week-end British and American banks decided upon temporary assistance and £2,000,000 in gold was sent by aeroplane from England to the Continent. The London meeting was attended by leading statesmen and the presence of Mr H. M. Stimson, the American Secretary of State, is sign.ficant. If, as is believed? a settlement is reached then we should incline to the opinion that the present world depression will begin to disappear. The nations are brought face to face with realities, and they must now realise the urgent need for co-operation. I here is more warrant for confidence now than at anv time during the past 18 months.