Bay of Plenty Times. EVENING DAILY SATURDAY, NOV. 30th., 1935. WORLD PRODUCTION.

Bay of Plenty Times, Volume LXIV, Issue 11888, 30 November 1935, Page 2

Bay of Plenty Times. EVENING DAILY SATURDAY, NOV. 30th., 1935. WORLD PRODUCTION.

The economic intelligence service of the League of Nations has issued a bulletin of “World Pro- , duction and Prices,” 1923 to 1934, which is similar in scope to the volume published last year. On the evidence afforded by the statistical material the conclusion come to by the compilers that the recovery in productive activity which began in the middle of 1932 continued throughout 1933 and 1934. In 1934, commodity prices in terras of national currency rose in a number of countries (though moderately in most cases), prices on world markets as expressed in gold continued to fall though ar a much slower rate than previously. _ Employment and industrial activity improved in most countries and visible supply of primary products was considerably reduced. The quantum of world trade increased by 3 to 4 per cent. Agricultural production, which had previously remained remarkably stable at about the level reached in 1928-29, shrank in 1934 by 3 per cent., partly as a result of widespread drought and partly owing to deliberate restriction in certain countries. In response to increased industrial activity, the world output of nonagricultural commodities rose by 12 per cent, in 1934, following a rise of 13 per cent, in 1933, which was practically the same as the average for 1925-29. Industrial in the world, apart from the U.S.S.R., increased by 8 per cent., as compared with a 13 per cent, increase in 1933 to a level some 16 per cent, below the average for 1925-29. By the first quarter of 1930 it had risen further to about 10 per cent, below that level, or if the U.S.S.R. be included to 5 per cent, above it. But the volume of world trade still remained 15 per cent, below the 1928-29 level. While wo r ld production of foodstuffs was almost as large in 1934 as it had beep in 1929, the volume of international trade in foodstuffs had shrunk by about 15 per cent., mainly as a result of increased selt sufficiency of numerous food importing countries. The trade in foodstuffs was'indeed considerably smaller in 1934 than in 1932, the year in which the low point of the depression was reached. The volume of international trade in industrial raw materials shrank less than the world production of these commodities be- 1 tween 1929 and 1932, the shrinkage in the former being 19 per cent., compared with 27 per cent, m the latter case. Both trade and produce rose rapidly in : 1933, but in 1934 trade expansion was checked by clearing agreements concluded between a number of European countries, and the rate of increase in production slowed down. In that year raw material production and trade fell short of the 1929 volume by 15 per cent, and 12 per cent, respectively. The volume of international trade in manufactured articles shrank more than manufacturing production ‘ between 1929 and 1932, namely by 42 per cent., compared with 38 per cent. Export industries suffered more from the depression than industries producing for home consumption, and have benefited less from the subsequent revival. In 1934 manufacturing production was about 24 per cent, and trade in manufactured products 36 per cent, below the 1928 average. •The industrial recovery which took place between the summers of 1932 and 1933 was common to almost all countries. Subsequent experience has varied. In the countries in the European gold bloc industrial activity has either declined or stagnated under the influence of deflationary pressure. In the United States industrial activity has been extremely erratic, there has been considerable improvement since 1932, but industrial production in the early part of 1935 f-ytill remained below the point reached in the summer of 1933. Canada, though largely influenced by the United States, had recovered substantially more by the first quarter of 1935. In Germany and Italy industrial production has increased • rapidly, largely as a result of Government action, but it had not reached the 1929 level by the first quarter'd' 1935 when that level was considerably exceeded in the United Kingdom, the Scandinavian countries and Finland. The rapid decline in commodity prices which began in 1929 was stopped in many parts of the world in 1933. Though the changes in the general price levels were, on the whole, comparatively slight in 1934, wholesale prices tended to rise in most countries with depreciated currencies, and to rise more than the cost of living or retail prices. On the other hand in the full gold standard countries the deflationary pressure on prices persisted in 1934; and the early part of 1935.

PERSONAL MESSAGE,

, The Prime Minister of England, Mr Stanley Baldwin, has sent a personal message to Signor Mussolini, the Dictator of, unfortunate Italy, inviting him to formulate conditions on which he would expect to end hostilities in Ethiopia. This is a new and important phase in diplomacy, and tends to show that Britain still holds a friendly feeling for Italy, and also shows the keen d“sire of the British Government ro put an end to a campaign which is developing into a comic opera. According to Signor Gayda, who has been frequently heard 'from since Italy started her war, Signor Mussolini .is eager for an Abyssinian settlement. There is a great deal of truth in the statement that if the war is continued for another mouth Mussolini will not be able to conduct it on the present extravagant scale. Bo has managed to raise, or is in process of raising, a large internal loan, but such money will, not buy the raw materials, and particularly coal, oil, and cotton which Italy will need for the continuance of the campaign. Russia and Roumania, the two countries which supply Italy with about 80 per cent, of the petrol she requires, have intimated to the League that they are prepared to stop supplies, in any case they are bound to demand payment in gold, of which Italy now possesses comparatively little. It is a splendid opportunity for the Duce to extricate himself from a dilemma. Gayda goes on to say'that Mussolini knows that despite the people’s gallant efforts to resist. sanctions, doubts and murmurings are to be heard of the possibility of Italian defeat, and it is even for the first time suggested by the officially-in-spired Press. Sanctions are real, and added to the earlier sacrifices the Italian people have had to makd the position becomes unbearable. Another month or six weeks of the war and there will be starvation and abject poverty in the country, which itself would be hopelessly bankrupt. The Duce must realise that in his present hazardous situation discretion is the better part of valour. 1 He has now an excellent opportunity of concluding a peace that would not be dishonourable to Italy, and would further have the support and goodwill of, Britain, which will always be worth a good deal to Italy.

It is to the interests of the world to see the war ended. The world cannot do ' without Italian . trade. Already the economic sanctions have thrown out of balance the structure Of international trade, driving the smaller countries to seek safety in seif sufficiency, which is adding to the troubles of the world. In the immediate post war period it was Russia that caused a disturbance of world tiade, and since then other countries have l.een compelled to restrict import. The ideal would be to see all the nations trading peacefully wuh one another, but. through the force of circumstances they are waging an economic war instead.