BRETTON WOODS AGREEMENT

Ashburton Guardian, Volume 66, Issue 268, 24 August 1946, Page 3

BRETTON WOODS AGREEMENT

“NOTHING TO GAIN BY RATIFICATION” COMMENT BY MR C. M. WILLIAMS (P.A.) WELLINGTON, August 23. Gratification that the Budget contained no reference to the Bretton Woods monetary agreement, which seemed to indicate that the Government did not intend to ratify it, was expressed by Mr C. M. Williams (Government, Kaiapoi), when he spoke in the Budget debate in the House of Representatives to-day.

The Leader of the Opposition (Mr S. G. Holland) had given the impression that he was against the Bretton Woods agreement, but was careful not to commit himself, said Mr Williams. The underlying motive behind Bretton Woods was solely to provide means to enable the United States to continue its policy of selling goods to all the world without receiving goods in exchange. Replying to an Opposition interjection, Mr Williams said that he opposed the Bretton Woods proposals, which were asking the world to give a joint and several guarantee to the United States for the exports it may make to bankrupt and semi-bankrupt countries. The Bretton Woods proposals were highly detrimental to the British Empire, and contrary to the policy of import selection and import control of the Labour Government of New Zealand. The p'olicy of bulk purchase agreements with Great Britain Avould be quite outside Bretton Woods, which was based on the free exchange of goods between nations, except that the United States reserved to itself the right to impose heavy tariffs to keep out goods it did not want, and there was* every likelihood that such a policy would be applied. “So long as we remain outside Bretton Woods, we can help the United Kingdom to some extent,” said Mr Williams. “By remaining outside the Bretton Woods agreement we would remain free from domination of the fund and would be free to trade with Great Britain in any way we chose. In that way we could do more for Great Britain than we could as a signatory to the Bretton Woods agreement. If we joined, our voting strength would be only .7 per cent. The original agreement gave the United States voting strength to out-vote Great Britain and and the Soviet Union together, and jt now appears that the Soviet Union is not coming into the fund. “Australia is not coming in,” continued Mr Williams, “and I don t think we are coming in.” He added that New Zealand might gain nothing by joining, but It would risk the loss of its economic independence, and its import selection policy Avould be sacrificed.

“Avoid Entanglement With U.S.”

It has been advanced as a reason for New Zealand’s adherence to the Bretton Woods agreement that it would give currency stability, but past experience showed that the dollar, to which the agreement would tie New Zealand, was far less stable than sterling or the New Zealand pound. “We should avoid any entanglement with the United States, and I hope that there will never come before this House any proposal to ratify the Bretton Woods agreement,” said Mr Williams. Mr R. G. Gerard (Oppsition, MidCanterbury) said that the member for Kaiapoi was “flying kites’ to see what the reactions of the people would be. Probably the Minister of Finance (the Rt. Hon. W. Nash) and the member for Kaiapoi were not in agreement about the Bretton Woods proposals, hut time and time against the Opposition had put forward its views and had asked for a debate on the matter, hut all it had picked up from the Government was that New Zealand could not keep out of the agreement.