DEBT PAYMENT

Hokitika Guardian, 7 December 1932, Page 5

DEBT PAYMENT

BRITISH NOTE

CREATES PARTICULAR INTEREST

(British Official Wireless.)

iRUGBY, Dtecember 5

Mr Baldwin (Acting-Prime Minister) had a conversation with Mr Mellon, and 'discussed various points in the British note.

As some misunderstanding has occurred regarding the reference in the British note to the consequences of tile resumption of payments, the exact words of the note on this' subject are creating particular interest. After making the point that the discharge of all internation'aT debts must finally take the form of a transfer of goods and services, the note said: “If, therefore, war debts payments had to-be ■resumed, it is apparent that the exchange position in this country would nesid to be (strengthened by a reduction of the very heavy adverse balance of visible trade- between the United Kingdom and the United (States which amounfed to £.8,000,000 in 1931. In the present circumstances, this could only be done by adopting measures which would-further restrict British purchases' of American goods. ','" V' " ' x ,f The United Kingdom lias, up to the present, generally, been the best customer of the United States, and the result of such restrictions would inevitably bo to reduce specially the market in. the United! Kingdom for Amoridan products, to' the extent there of more than the.. payments.-resumed to the United' States Treasury., Definite and unfortunate reaction must follow to the United States producer. Moreover, His Majesty’s 'Government also have to guard against the efforts which would follow, if facilities were, offered by the British market used by other debtors than America, to obtain sterling, which they would then sell across exchange to meet their obligations to the United 'States Government. “After the war, the United Kingdom attempted to maintain the traditional systetm of free imports, with the result that the debtor' countries throughout the world*sold goods.on the British market,' and.took the proceeds away over exchange or in gold, ■ to meet their obligations elsewhere. -_ Under the stress of the present, crisis, His Majesty’s , Government, have had to modify their system, and to adopt tariffs', but the United Kingdom still imports from abroad foods - to the value of’several hundreds .of millions ot ooundls- in excess of what it exports. It fvjll. fee, ..necessary.to consider what action could he taken to secure that the sterling proceeds of these imports were used more largely for the benefit of the. British market.”

HOOVER’S NOTE TO; CONGRESS

WASHINGTON, December 6,

President Hoover to-day. .decided. to transmit a special foreign affairs note to Congress late tnis week. It will incorporate debt recommendations. It will perhaps also .discuss, the Disarmament and Economic Conference. Mr Hoover abandoned' the idea of waiting until December 15, when he became satisfied that practically ■ all of the methods designed to ease the exchange burden on Britain through making the debt payment had been explored without any remedy being found.

It is understood that this information has been transmitted to the debtor Governments, through diplomatic channels.

ITALY WILL PAY AMERICA,

ROME, December 6. The Fascist Grand Council, have de- • tided that Italy will pay her war debt to America. The instalments due on December lo are £250,000 at par, but no more. Signor Mussolini reaffirmed the “clean sVate” policy regarding war debts, and asked for immediate revision.