Sympathy In Britain For N.Z. Economic Difficulties

Press, Volume XCVIII, Issue 28822, 17 February 1959, Page 12

Sympathy In Britain For N.Z. Economic Difficulties

(From Our Own Reporter)

WELLINGTON, Feb. 18. . "There is a more confident tone among manufacturers, distributors and financiers in Britain than for many years, although there are some "soft spots,’ such as mining,” said Mr N, L. Macbeth, commercial editor of “The Press” on his return to New Zealand today from Britain. Mr. Macbeth has spent nine months in Britain as an Imperial Relations Trust bursary. "Exports are rising and the £ is widely sought abroad, and the common man has more of the luxuries of life than ever before. A staggering array of goods presents itself, to the shopper from abroad; clothing, consumer durables (apart from those such as motor-cars which carry heavy tax) and toys may be mentioned among the ‘bargains’ from the New Zealander’s point of view,’’ said Mr Macbeth.

“There was a great deal of sympathy in Britain for New Zealand in her present economic difficulties. Mr Macbeth said he had met many English people who remained loyal to New Zealand butter right through the "crisis” of last year, when several countries were dumping butter in Britain. "By and large, however, the British housewife is very priceconscious and if our butter gets

too expensive she will switch to another butter, or to margarine.” he said. The intense competition in many aspects of business life in Britain impressed Mr Macbeth. “Because his potential market is so large every manufacturer knows that he has a good chance of reaping the full benefits of greater efficiency and reduced costs. This applies also in retailing—most of the present chain - stores have developed from one original shop —and to financial services, such as stockbroking and insurance.” The distribution of food in Britain was a good instance of efficiency resulting from competition. "In spite of criticisms made at the inquiry last year, Smithfield Meat Market does handle a huge volume of business each day with a minimum of delay. Homeproduced raeata are offered here in competition with imports from all the major smarting countries of the world; aB the main importing finns have their own

turers and wholesale and retail : butchers.” Similarly, in other aspects, of . food distribution competition ; i helped to keep down prices. ; Shoppers in all , but the smallest . or most isolated communities had , the choice of several national brands of sausages, fpr instance,.' as well as the small butcher’s own make; they could also choose between various national chain ! stores, the local co-operative shop or the independent shop. "It is ■ significant that food processing and retailing is following the trend of other industries and tending to fall into the hands of large combines. The supermarket is catching an increasing share of food sales.”

The leaders of the British Labour Party were now soft-pedal-ling “if not back-pedalling’’—on the issue of - nationalisation of industry. This was generally interpreted in Britain as a political manoeuvre on the ground that “there are no votes in it” Mr Macbeth said it might also suggest that the Lab Part; leaders now tacitly acknowledged that industry was more efficient in private hands than under State control. Britain’s Reserves

“In case I should, be thought to be painting too rosy a picture of the British economy, let me acknowledge that there are causes for some misgivings about Britain’s long-term position First of these is the size of her overseas reserves. Some 40 per cent, of the world's trade is conducted in sterling, but Britain’s reserves amount to only 5 per cent, of world reserves. This is a very narrow margin for a country depending so heavily on trade—visible and invisible—as Britain does.” Other factors included the possible adverse effects on Britain of the establishment of the European Economic Community and increased overseas competition for some of her traditional industries, such as shipbuilding and cotton spinning. .Mr Macbeth travelled extensively in Britain, visiting factories,'markets, farms and universities. He spent a month on the Continent, and has been particularly interested in the Europ in Economic Commimity. With Mrs Macbeth, he arrived today in Wellington In the Ruahine.