DOMINION’S TRADE.

Taranaki Daily News, 1 June 1922, Page 8

DOMINION’S TRADE.

REASONS FOR DEPRESSION. MR. DALTON’S REPORT. INCREASED LAND VALUES. London, April 21. The Board of. Trade Journal contains a. very full account of economic developments in New Zealand during the year 1921, and Mr. R. W. Dalton (British Trade Commissioner at ' Wellington), at the end of l|is report, has something to say which will be of interest to traders and producers in the Dominion. “It would not be at all desirable,” he writes, “to under-estimate the true importance of the set-back which New Zealand has had, but one cannot help feeling that the extent of the depression has been grossly exaggerated, not only abroad, but in the minds of New Zealand interests themselves. The key to the position is, of course, the phenomenal increase in the value of land as a result of war prosperity, the difficulty of making these lands pay at lower prices for produce, and the existence of heavy mortgages, on which interest has to be paid. The last is undoubtedly the greatest difficulty, and the Government has legislated to give relief to farmers to get over this difficulty. The necessity for making highpriced lands pay at lower prices will unquestionably lead to better means of production, and it has been by no means proved that under better conditions of production and distribution, the lands of New Zealand, even at the phenomenal prices at which they have changed hands, cannot be inade to pay in normal times. The true deciding factor as to New Zealand’s economic position must be the return which the Dominion can secure abroad for her produce, and it has been shown that, looking at New Zealand as a whole, there has been little to complain about on this score, even in a year which is said to have 'been one of the worst ■which New Zealand has ever experienced. To imagine that New Zealand could be ‘ruined,’ as some people have suggested, is ludicrous. Even before thia depression had really hit the Dominion prices for her main products had. begun to rise, and indications now are that a very definite and important improvement has set in. “It will take very little improvement in economic conditions at home to bring about more important improvements in New Zealand, and it should not be long before conditions show a very marked change. It is not suggested that everything is now plain sailing. The position, particularly in regard to mortgages, will need very Sareful attention for some time, and this tbGovernment has shown itself prepare u. to give. With this difficulty tided over it should fee possible for New Zealand gradually to adapt itself to the new conditions brought about by the war, and either to make lands pay at their new values or gradually to reach a proper level. I am quite satisfied that the true cause of New Zealand’s depression was, in the first place, overimportation against a former apparently favorable balance of trade, which in reality was unfavorable, and, in the second place, the fact, that by terms of the Imperial Government purchases New Zealand had received what may fee called its salary for a period in advance, and for a time, when values were falling heavily, had to carry on with no new income coming in. The statistics show that, looking at New Zealand as a whole, production and exportation have not suffered, and this must surely be the true guide to the real position. As a primary producing country, and taking into account the world shortage of stock of all kinds, New Zealand mttst, as wbrid v conditions improve, recover something at least of the prosperity which she experienced during the war, and during this period she will be able to get breathing space to apply the lessons which the past few years have taught.”