NEW ZEALAND’S PROBLEMS

Press, Volume LXXXIII, Issue 25269, 22 August 1947, Page 8

NEW ZEALAND’S PROBLEMS

WORLD SITUATION REVIEWED

“WE ARE FORTUNATE INDEED” (From Our Parliamentary Reporter.) WELLINGTON, August 21. Although New Zealand, two years after the wsr, was still faced with •erious shortages in housing, equipment, and certain commodities, and had many other problems arising out of the wholesale diversion of manpower and productive capacity to war, the Minister of Finance (Mr W. Nash), opening his Budget speech in the House of Representat? es this evening, said the country was fortunate indeed in comparison with the problems facing many other countries. New Zealand, he said, in a review of the international siti tion, could not hope to be prosperous for long if the principal buyer of her exports, Great Britain, was impoverished.

“The whole world to-day is struggling with a maze of complex and baffling problems of vital imj. ortance to the standard of living and the general welfare and security of untold millions of people, all arising out of the colossal devastation, the vast accumulated loss of production for peace-time purposes, and the chaotic disorganisation resulting from the war,” he said. “We watch with special interest and sympathy the struggles of Great Britain to repair the ravages of war, to reconvert her industries to peace-time production, and to rebuild and expand an international trade large enough to obtain the food and raw materials necessary to enable the standard of living of her long-suffering people to be restored at least to its former level.”

It was now clear the United States and Canadian special loans granted to giye Great Britain time to adjust her economy and her large overseas debts arising out of fche war, would be exhausted this year and much earlier than she could possibly complete the unprecedented task of reconstruction before her. Consequently, the economic position of Great Britain was very serious. Furthermore, as international trade was so vitally necessary to Great Britain, her .zelfare was interlocked to a considerable extent with that of other countries, and particularly those in Europe. Under what was generally referred to as the “Marshall Plan,” great hopes were raised by the offer of the United States to give powerful assistance to an organised and co-ordinated reconstruction effort. The success of the plan would indirectly, if not directly, benefit Great Britain, but it was clear that help in that way could not be expected in time to avoid the imposition of further austerity before the exhaustion of the United States and Canadian loans. In fact, the problems of all countries were accentuated by a dollar shortage which threatened to reduce trade with the United States and Canada drastically and thereby deprive the rest of the world of the ’ invaluable assistance that otherwise i could come from the huge productive ! resources of those countries.

Attachment to Britain “While our attachment to Great Britain has stronger bonds than material self-interest, it is true to sav that our material interests also ar*e bound up with our people in the Homeland ’ said Mr Nash. “Trade within the British Commonwealth as well as international co-operation is essential to the rehabilitation of a war-shat-tered world. The reduction of barriers to international trade is a major objective in the solution of the world’s economic problems, and the importance of co-operation in this direction is recogmsed by the 18 nations at present meeting at Geneva under the auspices of the Economic and Social Council of the United Nations to prepare a draft charter for an International Trade Organisation.” Stability of supply and demand, especially for basic

foodstuffs and raw materials, was essential if the world-wide economic depressions of the past were to be avoided. The draft charter was to be considered at a world conference on trade and employment which was ye?r tO be held about the en dofthis

The nations represented at the Geneva meeting were also taking part in a series of tariff negotiations. It was intended that all countries present at Geneva should receive the benefit of tariff reductions negotiated in that way through a multilateral tariff agreement to be prepared when bilateral negotiations between the various countries had concluded. More Production ‘■Fundamentally, the solution of the world s most pressing problems can come only from more production and more trade,” said Mr Nash. “It is available goods and services, and not money, that provide a standard of living. We can best assist by expanding our primary production, in which we have so many natural advantages, to provide more food for the hungry people of Great Britain and by raising the output of our secondary and construction industries to help ourselves

‘‘There are many goods which we cannot make economically, and these we must import as they become available. Plant, machinery railway roll-ing-stock. and vehicles to rehabilitate our transport system are in this category. In other directions a solution of our difficulties lies more within our own resources.”