THE BALANCE OF TRADE.

Auckland Star, Volume LVII, Issue 138, 12 June 1926, Page 18

THE BALANCE OF TRADE.

(To the Editor.) -Sir,—Professor A. H. Tocker, M.A., of the Canterbury College, in an interesting article published last August, made an attempt to improve on the tisual method of computing the balance of trado and to bring into his calculations all the factors which enter into the problem. Thus lie adds to exports the amount of Government and local body loans raised, tourists' expenditure in the Dominion, and money brought in hy immigrants. On the other hand, he adds to imports, interest on public debt, interest and dividends on foreign private investments in New Zealand, expenditure by tourists abroad, etc. The following is the result:

I do not think these figures are exact; in fact, they are not put forward as being anything but a near approximation to the position, but they show how insane were the periodical "warnings" issued by amateur economists all over New Zealand against over-importation during the years 1922-25, the truth being the contrary. As a matter of fact the Dominion, during the four years mentioned was redressing (by excess exports) the adverse balance of 1921, due, as we all know-, to the duplication of merchants' orders given in war time, and Which, they never expected would be filled. During the last six months, and owing to a drop of 50 per cent in tbe I price of wool, the trade balance is temporarily against us, thus the cry of "wolf is, for the moment, justified. But persistent "warnings" against, excessive importations, based on a "lack of reliable data" (vide Government statistician), remind one of a man who, all through the day and night, bemoans the ebb tide. He is right part of tho time; silly all the time. The moral is to leave the balance of trade to the banks. They will now place a check on importers and encourage exporters, and we may rest assured the balance will be redressed in due time. In the meantime the primary producer will find it easier to market bis produces abroad. —I am, etc., C.H.N.

Year ended Other Total |Mch. 31. .Exports. Loans. iteius.(£ milions) ' 1921 .. 4S.22 .'1.10 1.3 52.S2 1022 .. 43.79 7.34 1.5 52.03 1923 .. 45.55 5.1)2 ].." 52.97 1!>24 .. 51.(55 5.10 1.5 5IS.31 1925 .. 54.77. 7.7'.l 1.5 64.0*5 243.98 29.31 7.5 2S0.79 Interest on Other Total Imports. Pub. Debt, items. (£" ruins) 1921 .. 73.59 4.79 2.5 80.8S 1922 .. 311.25 5.14 2.5 10.S9 1923 .. 40.47 * 5.42 2.5 4S.M9 1924 .. 48.44 5.0S 2.5 5(i 02 1925 .. 54.35 5.99 2.5 02.84 250.10 27.02 12.3 295.02