INTERNATIONAL MONEY PLAN

Press, Volume LXXIX, Issue 23916, 7 April 1943, Page 3

INTERNATIONAL MONEY PLAN

PROPOSALS BY U.S. TREASURY RESTORATION OF GOLD STANDARD 18.0. W.) RUGBY. April 5. Mr Henry Morgenthau, United States Secretary of the Treasury, at a secret meeting in joint session of the Senate 9ommittees for foreign relations, banking and currency and post-war economic policy and planning, presented the United States Government’s plan for post-war international money stabilisation, proposing world restoration of the gold standard, says a Washington message.

What Mr Morgenthau said is not disclosed. but a statement issued to the press outlined the main proposals. These were: (1) the establishment of an international stabilisation fund, to be taken part in by all the United Nations and by countries associated with them who would contribute to the fund; (2) the creation of an international board to control the fund, with the participating nations appointing members, and with voting powei on the board fixed according to each country’s contribution; (3) an agreement among members not to engage in competitive depreciation of their currencies; (4) the attainment of stability by fixing the values of currencies in terms of gold; (5) the retention of est c blished channels of international trade and international banking for all international, transactions. Mr Morgenthau outlined tentative proposals of the United States to participate. with a contribution of 5.000.000.000 dollars to the stabilisation fund.

This American scheme for a post-war .currency system, which the United States Treasury has submitted to the Allied Governments, was elaborated by Mr Morgenthau’s economic adviser (Mr H. D. White). He said it was proposed to establish a “United and Associated Nations’ Stabilisation Fund" of at least 5 (K’0.000.000 dollars, the resources consisting of gold and also of currencies and securities of the partici ■ pating governments. These governments’ contributions would be on a fixed basis, according to the gold holdings, trade balances, and national incomes of the respective countries. Voting rights on the board controlling the Stabilisation Fund would depend ,on their quotas, the' maximum for any country being 20 per cent, of the total votes. , The scheme proposed the establishment of a now international monetary unit called “unitas." equalling 10 dollars. which would be freely convertible to gold. The board would have absolute power to fix the exchange rates of the participating countries and also the price of gold. It might authorise a certain r?nge of fluctuation of rates and also call on any member country to buy the currency of any participating country, with its government s consent. ... Participating countries would be required as soon as practicable to remove exchange restrictions other tlum those on capital transfers. Unauthorised international capital movements would be prevented by closer collaboration among member countries.