CREDITS FOR ALLIES.

Auckland Star, Volume LXX, Issue 197, 22 August 1939, Page 6

CREDITS FOR ALLIES.

BRITISH LOANS £60,000,000. NEW ZEALAND INCLUDED. Measures to extend the scope of the exports credits guarantees of the Board of lrade, and which are set out in the Overseas Trade Guarantee Bill, will enable allies of Great Britain to obtain credit® up to a total of £60,000,000, instead of the previous maximum of £10,000,000. ihese credits will be granted ior political reasons, and remain distinct from the ordinary commercial business of the Exports Credit Guarantee Department. The procedure hitherto *has been for a foreign (jovemmcnt to _ borrow by means of an instrument which the Board of Trade would guarantee, and which couM then be readily placed on the London market. Now, however, the term of such loans has been extended to as much as 10 to 15 years, and the volume is more than the market easily digest at present.- The Board of Trade, therefore, is empowered itself to hold the foreign securities with money advanced by the Treasury. According to "The Times." nearly the whole of the £60.000,000 had been provisionally allotted when the hill was presented to Parliament last month. It is intended to guarantee export trade transactions which are considered "expedient in the national interest," and to help purchases of arms by countries such as Poland. Rumania and Greece. New Zealand has been one of the Litest countries to receive assistance under the new provision?. Guarantees are sranted at the discretion of the Ronvd of Trade, subjcct to the approval o? the Treasury, and may be given only to a person carrying on business in Great Britain, or for the benefit of such person. As interest and other chartres will be added to the nnximum liability of £60.000.0fM\ and as the transactions under the provisions for commercial loans probably exceed £7<"i.C>oo.ooo. these credits must now play an important pnrt in foreign trade.