CRISIS MET

Waikato Times, Volume 127, Issue 21210, 5 September 1940, Page 9

CRISIS MET

FUNDS OVERSEAS REDUCED IMPORT TOTALS PRODUCTION YEAR ESTIMATES (By Teleyrapb—Press Association) WELLINGTON, Wednesday A general outline o£ the economic and financial position o£ New Zealand was given by the Minister of Finance, the Hon. W. Nash, in addressing the Economic Conference which was opened at Parliament Buildings today. Dealing with the economic position, the Minister said exports for the year ended June, 1939, were £57,892,000, and for the year ended June, 1940, £65,859,000, representing an increase in values of 13.6 per cent. In December, 1938, the overseas assets of all banks in New Zealand amounted to £6,807,000; December, 1939, £15,811,000; June, 1940, £27,382,000; July, 1940, £25,574,000. This showed that the crisis in the overseas funds position which occurred toward the end of 1938 had been met. It did not mean, however, that the country had ample overseas funds for all its needs. Strain On Funds The Minister added that there would be a demand this year for the debt commitments of local bodies to the extent of £2,000,000, while the Government was repaying £2,000,000 in connection with its last £16,000,000 loan, and next year it would have to meet an instalment of the £3,500,000 loan. In addition there would be the increased strain of war expenditure on account of overseas needs. Though Britain was willing to finance this aspect, Mr Nash urged that it was desirable to some extent to make some current contribution. Compared with the demand for overseas funds on account of consumer goods, raw materials for industry and equipment, Mr Nash continued, the supply of funds was insufficient. Quite apart from war purposes, therefore, it was necessary to control the allocation of overseas funds, so that only commodities essential for New Zealand should be bought. Control also made it easy to allocate funds for goods necessary for war purposes. Imparted Goods Dearer Mr Nash also dealt with the Government’s long-term import policy. He said imports for the year ended June, 1939, amounted to £56,500,000, and for the year ended June, 1940, £46,070,000, a reduction of 18.5 per cent. This showed the operation of the import selection programme. Unfortunately the latter figure had swollen somewhat because of the upward trend in the prices of imported goods. Thus motor spirits were reduced 25 per cent in quantity, but there was a rise in the value of motor spirts of 9 per cent. “There are £34,000,000 worth of import licenses existing for goods still to be imported,” said the Minister. Mr Nash also submitted a table showing the rise in wholesale prices from June, 1939, to June, 1940, those for the five-year period 1926-30 being taken as a basis. These increases in wholesale prices, perhaps, would not immediately be shown in retail prices, said Mr Nash, and perhaps not to the same extent, but it should be noted that they entered into costs. The Minister also presented another table dealing with retail prices, wage rates and export prices. He pointed out that the table showed that export prices were not synonymous with returns to farmers. Where production had increased, farm income had increased. Since September, 1936, retail prices and export prices had risen almost identically, but the wage rate index number showed a smaller percentage increase. Workers Under Awards Workers in unions under the jurisdiction of the Arbitration Court represented only about 50 per cent of all wage and salary earners and 70 per cent of workers in industries covered by the wage rate index This, combined with the fact that where applicable board and lodging additional to wages were not affected, accounted for the tentative wage rate index for August, 1940, not being 5 per cent higher than for June, 1940. Discussing production, Mr Nash said a table had been prepared by the Government Statistician of estimated production for the year 1940. The table showed a preliminary estimate of production for the year ended June, 1940, at £140,500,000, compared with £135,300,000 for the year ended June, 1939. Among the estimates for the production (year ended June last, with comparative figures for 1939 in parentheses, were:—Pastoral, £38,500,000 (£37,400,000); dairying, poultry, bees, £36,800,000 £33,800,000); factory, £30,500,000 (same). However, Mr Nash reminded the conference that consumer goods were not necessarily increased merely because the total production increased. Concluding, he said that, with the war effort taking prece-

dence, every step would be taken to maintain civil activities and living standards at the maximum.