TRADE CONTROL

Wairarapa Times-Age, 27 April 1939, Page 7

TRADE CONTROL

FINANCE MINISTER DEFENDS POLICY APPEAL TO MANUFACTURERS & WORKERS. INCREASED PRODUCTION ESSENTIAL. (By Telegraph—Press Association.) WELLINGTON, This Day. A review and defence of the Govern • ment’s policy of import selection and exchange control was given by the Minister of Finance and Customs, Mr Nash, in a national radio broadcast from Wellington last night. The Minister recited again the circumstances which he said had compelled the Government to introduce the import licensing system, and contended that it was the best of the several methods suggested for meeting the position. Mr Nash, in an appeal to New Zealand manufacturers, said that for their own and their country's benefit they should lose no time in bringing their plant and organisation to the highest point of efficiency. He also urged the workers to do their part to increase production and so maintain the country's standard of living. The Minister, referring to his coming visit to London, said the New Zealand Government would do everything possible to reduce the difficulties that might come to the United Kingdom manufacturers and others. He was going to London to discuss trade, defence, and the loan that was due to mature shortly.

In his address the Minister said that the decline of sterling funds by over £21.000.000 in eight months last year was* clue: First, to persons and companies who had left money in the Dominion in the expectation that there would be an alteration in the exchange rate deciding to transfer the moneyoverseas. They had the right to take the money out, and the Government had not at any time challenged that right. They. were, if they so desired, able to take’it out still. Secondly, following on the transfer of that money, the country had been over-importing because the returns from the sale of exports, mainly wool, had fallen, and imports had been maintained. The result had been a decline in sterling funds.

Thirdly, some New Zealanders, between April, 1938, and December, 1938, felt ■ that they could get more interest on their money if they sent it overseas. They unpatriotically sent their money overseas because it would bring them half or one per cent more interest.

‘‘These things caused a drain on the funds that was very severe,” the Minister said, "and if the withdrawal had continued it would have been difficult to keep to our commitments.” . Mr Nash emphasised that the circumstances operating meant a restriction of imports whatever course had been followed. They could have been restricted by heavy tariffs or by a reduction in expenditure. This latter course had been tried previously and had succeeded in building up the sterling funds to £46,000,000. "But was it worth the price? Is it worth the price?” Mr Nash asked, remarking that there had been 70,000 unemployed and widespread destitution and hardship. The previous Government had succeeded in building up funds overseas, but the price, measured in human values, was too high, he said. The present Government had decided to follow a new road and to select the goods that should be imported according to the needs of the Dominion. The licence procedure, which was published oir Saturday last, provided for the prohibition of non-essential goods, the restriction of goods partly essential, and the issue of licences for all necessary commodities. MAINTAINING PRODUCTION. "We want to maintain production because it is by production that we live,” said Mr Nash. "Our standard of living depends upon the commodities that are produced in this Dominion. Under the new procedure manufacturers of all goods that are necessary to the well-being of New Zealand may obtain licences for plant, equipment and raw materials. “The idea is that to the extent that our own producers can satisfy the legitimate demands of the Dominion, we will not import products from overseas but to the extent that they are not able to meet the legitimate demands, then the Internal Marketing Department will import those commodities that are necessary. We cannot buy more goods than we pay for. We might obtain the goods, but if we obtained them without paying for them somebody else has to pay for them. If we can’t buy more goods than we can pay for, surely it is better to select the goods to be excluded than to have a general cutting down of imports?” Mr Nash said the Government’s policy provided for the expansion of local industries, and he proposed to ask the Minister of Industries and Commerce to make public the list of new factories that had started or were about to start. The expansion of production had been organised in a splendid way 1 by the department, and the manufacturers had responded equally splendidly. PROCESS OF SELECTION. Overseas manufacturers were having their goods excluded, but the Government was encouraging them to come to Now Zealand and make their products here, Mr Nash said. If, however, the Government allowed everyone to come in it would mean a greater demand on sterling funds for plant and material. Therefore, there was a committee working, and its job Was to see that the licences recommended to the Minister for plant and equipment were in some accord with the quantity of goods that were required. The Minister said he would say to the workers of the Dominion that at present there was nothing more important than production and output. If the workers would do their part by increasing their output New Zealand could maintain the standard of living it had today and extend it to the point which he thought could be justified by the resources of the Dominion. POSITION OF IMPORTERS. Mr Nasii said he knew that a number ofdmporters would be hard hit by the restrictions. He wondered if it would be possible for the manufacturers to think out a procedure whereby to the extent that their trade was expanded they would try to g' ve some of the distribution side of it to those, who had ■ previously been 'mpor |n g| and had lost business. I The Minister devoted some attention to the statement issued yesterday by

the Importers’ National Committee. He quoted the following passage from the statement: “But the 'public make a profound mistake if they think that, in order to pay our debts, the devastation in business brought about by Government policy in this matter is an inevitable part of that necessity. It is nothing of the kind." Mr Nash commented: “The position is that our sterling funds amount to a certain sum of money. After we have made our provision for debts, the whole of the remainder will be available for imports. What more could we do?" The importers’ committee had also suggested that wharf workers would find there would be fewer jobs for them because ships would be bringing less goods, the Minister said. The ships were bringing the maximum goods possible. They were bringing less finished goods and more raw materials. BETTER WAY CHOSEN. "Whatever course we had followed — import selection, tariff increases, or depreciation or appreciation of the currency —all those roads inevitably lead to the restriction of imports,” Mr Nash said. "The way we have chosen is the better way. We are importing the goods we need.” The Government had not borrowed one penny overseas. Instead £4,000,000 had been paid off the overseas debt. Critics maintained that production had gone down, but that was not true. On the contrary, it had increased by 15 per cent. The policy of expansion was plain commonsense. . Mr Nash said that in his opinion the United Kingdom as a unit had done more I'm' the Dominion than one could reasonably expect it to continue to do The New Zealand Government W(Jll Id do everything possible to rethe difficulties that might come to the United Kingdom manufacturers mid others. That was why he was going to England. • Though we must look after our own people first.” said Mr Nash, "we must also visualise the world. I hope the United Kingdom will accept the reasons for the Government’s policy as] justifying its introduction.”