Wairarapa Times-Age TUESDAY, JULY 18, 1939. OUR APPROACH TO LONDON.

Wairarapa Times-Age, 18 July 1939, Page 4

Wairarapa Times-Age TUESDAY, JULY 18, 1939. OUR APPROACH TO LONDON.

ACCORDING to “Reynolds News”: “It, is now admitted X that the terms upon which New Zealand’s Socialist Government can raise the loans it needs in London will involve either further restrictions of imports, to which the federation of British Industries will object, or restrictions on New. Zealand’s social programme, to which the people of the Dominion will object. New Zealand’s fight, in short, is against a dictatorship of finance.”

Whatever thev may be worth as an epitomised statement of the attitude of some influential sections in the United Kingdom, these observations have little enough bearing in some respects on the realities of the position in which the Dominion finds itself. The necessity of cutting down to an extent on imports is absolute. There'is no oth.er method of re-establishing the balance of sterling which will enable the Dominion to. meet all its liabilities in London. It may be assumed that if the National Party took office tomorrow, it would devise some method of reducing imports from their recent level to one at which the Dominion would be able to pay its way. Restrictions on credit might be preferred to the present regulation of imports, but there is no political division in this country on the question of meeting our obligations to Great Britain.

An attempt by any section in Britain to insist that New Zealand should continue to import on the. scale attained in the last year or two would in effect be equivalent to a. demand that the Dominion should convert a state of temporary difficulty into one of chronic bankruptcy. It may be hoped that any attempt to enforce demands of this kind would be resisted as strongly by important sections of opinion in Britain as by New Zealand. Nothing is better established than that we have been importing much too heavily.

Our exports, which were valued at £44.9m in the twelve months ended March, 1935, rose to £65 m in fhe corresponding period to March, 1938, an increase of: just over £2om. In the same period, however, imports rose from £32.5m to £58.0m, an increase of £25.5m. For flic twelve months to March, 1939, 0111 exports were valued at £57.8m and our imports at £54.4m, a slate of affairs evidently not to be continued by a country which has to find some £lom a year for oversea debt charges.

Criticism in the United Kingdom, and to some extent 111 this country, has fastened on the-fact that while our exports to Britain for the twelve months to March, 1939, were valued at £47.9m, our imports from Britain in the same period were valued at. only £25.9m. Of the disclosed disparity of £22m, however, approximately £lom is accounted for by charges on national and local body debt domiciled in London. Our recorded exports to Britain include also commodities valued at £2.5m or more which are re-exported to other countries. There is still an apparent balance against Britain in her trade with New Zealand of about £9m and in the extent to which this can be reduced by switching to Britain trade at present done with foreign countries, or with other Empire countries, it no doubt ought to be.

It has to be remembered, however, that large amounts are spent, by New- Zealand on commodities which Britain, cannot supply, such as petrol, tea and sugar, and that curtailment of these purchases would be only less damaging to British investment and trade than curtailment of direct trade with the United Kingdom. If, for example, we did not buy petrol from American and other foreign sources we should have no use for British motor-cars. The margin on/ which it is practicable to work in obtaining from Britain goods now obtained from other countries is comparatively small.

The position ■will be in clearer perspective when details of the results of the negotiations now being conducted in London by the New Zealand Minister of Finance (Mr Nash) have been made known, but it would be trifling with facts to suggest that the Dominion could re-establish its position without reducing imports. It is already clear that time and thought may be given more profitably to the promotion of a policy for the progressive reduction of oversea debt than in attempting Io meet impossible demands when* the adjustment of trade policy is concerned.

A FARMERS’ PARTY.

NOTHING less than the possible organisation ol‘*a Farmers’ or Country Party in New Zealand appears to be implied in a resolution passed Ty the recent Dominion conference of the Farmers’ Union. As it. was published yesterday, the resolution contains the following passage:—

This conference is of opinion that ultimately political action through the medium of a rural party is the effectual means of securing economic justice for the farmer and the community in general. Therefore the Dominion executive is instructed to examine the question from all angles with a view to the adoption by next annual conference, or sooner if necessary, of concrete proposals to give effect thereto.

It must be hoped that the examination thus provided for will be very thorough. The danger that the formation, or attempted formation, of any new party may split and divide political elements that otherwise might have worked unitedly to their mutual advantage stands out very clearly. Political party action by the farmers’ Union has been opposed hitherto by many of its own stalwarts on the ground that an inevitable effect would be io break up tire unity of the organisation. It presumably remains impossible to disregard that weighty consideration, and in any case it seems hardly possible that even the strongest farmers’ Party in this country could achieve more than minority representation. It would be under the necessity, like the Australian Country Party, of entering into a working alliance with another party.

Il can hardlv be suggested that the working results of three-party politics in the Commonwealth have been particularly satisfactory from the standpoint either .of an effective representation of rural and other interests or ot political stability. Al present the Australian federal Government, though supported by two parties which muster between them an ample majority, is in some danger ol having Io go prematurely to an election on account of dissension between the leaders of these parties, in New Zealand a resolute attempt to compose and adjust political differences seems in every way preferable to the formation of an additional party.