DENMARK’S RATE

Hokitika Guardian, 26 September 1933, Page 7

DENMARK’S RATE

THREATS BY FARMERS. INCREASED DEPRECIATION. LONDON, 'August 18. According to a message from Copenhagen to the Financial Times, the Danish agriculturists are threatening to effect .a renewed depreciation of the krone exchange rate on .London by withholding the sterling proceeds of products gold in England. Though the Danish Government, a Socialist Administration, has done a good deal to help the farming community, whose difficulties un<le r the great depression have been enormous, agricultural interests still claim that they have, a grievance. The measures taken by the Government during the past year to help the farmer include the destruction of cattle and the distribution of free meat to the unemployed, .so as to raise the price of meat; the regulation of pig production, so as to raise the price of pork and bacon ; the passage of a moratorium law to protect farmers from foreclosure; the depreciation of the Danish krone by about 20 per cent, below sterling, in order to increase the kroner yield of produce exported to Great Britain.

But the farmer, and particularly the farmer of 'South . Jutland —or North Schleswig, as it, was known when under German domination—remains ungppeased. Leaders of a radical farmers' organisation, very strongly entrenched in South Jutl?nd are threatening to withhold their milk—and hence their cream and butter—from the market. What is more serious, they are also threatening to take 'action to hrino- the krone rate on London down to 30 to the pound, a.s compared with the present stabilisation level of 22.50.

The Government naturally, .refuses to give way to this form of 'dictation. It has warned the farmers that it intends to take every .step to protect' the present 'level of the currency. Moreover, it lia.s advised the farmers that any further depreciation of the loy] currency might well compel the British Government' to apply anti-dumping provisions against Danish exports. The suggestion is that -the farmers should withhold the sterling proceeds of products sold in England. for as long a period ;as possible. ..'The cheouys derived’ from sales of ' this." produce would simply be put away 'for the maximum period, the farmer cap stand. As roughly 80 1 per cent, of .Danish exports are agricultural produce, rpd. about 75 iper cent. of .this goes to Great Britain, it is not'difficult to see. that the withW’dxig of .foreign exchange- by the farming community, even for a week would make v a' great difference to the 'country’s exchange reserves. It is no* the first time the farmers lrve b-ought pressure of this kind, on -the Govern ment, and up to the present they have been fairly successful. . .