ECONOMIC PHASE

Manawatu Standard, Volume LX, Issue 142, 16 May 1940, Page 9

ECONOMIC PHASE

ALLIES FAVOURED. IMMENSE RESOURCES. SUPERIORITY TO NAZIS. (United Press Association —B,y Electric 'lelegrapn—(Jopyrigln,.) (British Official Wireless.) Received May 16, 10 a.m. RUOBY, May 15. While fully recognising that the Nazi invasion of the active trading and industrial areas of Holland and Belgium must result in sharp economic losses to Britain, the Financial News empliasises that it' would be foolish to over-estimate the forces which drive Germany to reject the path of limited warfare and economic consolidation in an attempt, at a decisive blow or to over-estimate the value of the economic prizes the invasion may bring the Germans.

The journal points out that Holland relies on imports both for her extensive transit trade, from which Germany has drawn such ample benefits, and for the support of lier manulactaring industries. And the Allies may cut oit her imports if the circumstances demand. Without them the balance ol her manufacturing and commeice would be 'distinctly unfavourable. In Belgium the position in many respects is still less iayourable to the. invader. Heavy supplies are needed not only to provide raw materials lor industry, hut also foodstuffs for a predominantly industrial community. Altogether, fears of growing pressure from the blockade and the growing weight of the Allied military output may have played some part in inducing the Nazi regime to disregard the economic balance-sheet and to concentrate upon the drive for a 6peedy and conclusive military action. While Britain is in a position to replace the supplies hitherto drawn from the Low Countries with those from overseas, the newspaper points out that the supplies from Holland, Belgium and other colonial empires are vital to Germany’s economic effort. FINANCIAL ASSETS.

“Whatever the strategic position,” adds the Financial News, “the balance of economic advantage is certainly in our favour. We have secured additional gold and loreign exchange assets totalling some £350,000,000 —a sum not verv far below the entire gold output of the Empire for two years at the current rate of output. We have probably secured negotiable dollar securities to the value of £150,000,000. Ihe Dutch merchant fleet comprises some 1,700,000 tons of efficient ocean-going vessels, roughly one-seventh of our own comparable tonnage at the close of last year. But the real size of the contribution to the Allied war resources is not apparent until we begin to consider the economic resources of the Netherlands Indies and the Belgian colonies.”