No-Remittance Import Licences

Press, Volume C, Issue 29502, 2 May 1961, Page 12

No-Remittance Import Licences

Because it will help to ease the serious shortage of new cars, the extension of the no - remittance import licensing scheme is to be welcomed. The scheme also a Hoars imports of other consumer durables, and thus adds a little to the variety of commodities normally available in the Dominion. How many additional cars will be imported through the Government’s decision on eligible overseas assets cannot be estimated with any accuracy; but the significance of the increase will be all the greater because of the recent rejection of a scheme for supplying vehicles on extended credit from the British manufacturers. However, the advantage* of no-remittance licences should not be allowed to obscure the

disadvantages of the system,

which should be regarded as a short-term expedient during a shortage of overseas exchange which may be only temporary. Generally the scheme involves the use of capital assets rather than income; it tends to inflate unrealistically the values of Australian shares traded on the New Zealand market; it encourages speculation in shares; and it can never be operated with complete fairness to all sections of the community. Moreover, irrespective of restrictions imposed on access to eligible funds, the scheme, like any other preferential arrangement of this kind, invites breaches of the law. The sooner total exchange resources permit such schemes to be

abandoned, the better will it be for normal trading and for the average consumer.