France Has No Funds To Buy N.Z. Wool

Press, Volume XCVII, Issue 28492, 23 January 1958, Page 12

France Has No Funds To Buy N.Z. Wool

"The Press" Special Service

WELLINGTON, January 22. France has stopped buying New Zealand wool because of the lack of exchange funds, the French Ambassador to New Zealand (Mr R. de Bereegol) said yesterday. At the recent Auckland wool sale no wool was bought for French merchants. Mr de

Bereegol said that this was not done as a reprisal for import controls imposed by the Government, but was the result of lack of exchange money between France and New Zealand.

“We are very sorry this has happened and wished that we could have avoided the situation,’’ said Mr de Bereegol, “but every time we buy wool from New Zealand we have to pay jn gold or dollars on the London market, and we cannot just afford to go on doing it.” Six months ago he warned New Zealand that France might have to stop buyinc. wool because of the lack of balance in exchange and trade between the two countries, continued Mr de Bereegol. On an average, France bought £25 million worth of wool from New Zealand each year, but New Zealand took goods worth only about £1 million from France.

“We. do not expect New Zealand to buy an equal amount of goods from France, but we do think that something should be

I done ,to make the balance of exchange a little more equal between the two countries,” he said. “After all, a 25-to-l ratio is very unfair. It would be all right if France was a wealthy country, but we are also having our economic troubles and we just cannot go on buying New Zealand wool and paying for it in gold and dollars. ' Mr de Bereegol said New Zealand could help the situation by taking French railway stock and electrical goods and giving other contracts to French firms.

“It may be that France will be forced to use artificial fibres. in place of wool te a very great extdht,” he added. "We want New. Zealand wool, but we cannot afford it. -Thia position is going to greatly affect our woollen manufacturers.” , Mr de Bereegol said he had made many approaches to the Government, but .. nothing had been done to rectify the position. "I greatly regret, that the noq-. availability funds has made it necessary for buyers from France fib cease the.-buying of New Zealand wool, although I note from the Ambassador's remarks that this is not a reprisal for New Zealand’s import policy,” said the Prime Minister (Mr Nash) when Mr de Bercegol’s remarks were referred to him. "I know that the balaiice-of-trade position with this country has long been a matter of concern for the French Government, but the recent action by the New Zealand Government is exclusively based on the need to conserve overseas exchange so, aa to ensure payments for imports, interest charges, and other commitments as they arise.”

New Zealand had a favourable exchange balance of £21.4 million In trade with France in the 1958-57 trade year. Exports were £20.1 million and imports only £ 1.2 million, ’ with “invisible” items making up the difference In past seasons France has ranked second only to Britain as a buyer of New Zealand wool, taking roughly 17 per cent of total exports.