Short-Term Loans For N.Z. Disturb

Press, Volume CVI, Issue 31221, 19 November 1966, Page 3

Short-Term Loans For N.Z. Disturb

(New Zealand Press Association) WELLINGTON, November 18. While New Zealand’s external debtservicing burden was light, the necessity in recent years to undertake short-term borrowing when levels of export income have been high was a somewhat unfavourable feature, the Commercial Bank of Australia, Ltd., indicated today.

“This is particularly so now that the export of capital by the United States and Britain has been severely restricted,” the bank says in its latest economic review. There was a severe shortage of funds on the recognised world capital markets, making further substantial borrowings difficult to arrange and at the same time forcing interest rates to exceptionally high levels.

“It is in relation to these factors that New Zealand rightly finds cause for watchfulness.” However, the bank said at

the beginning of an article on the subject of Government borrowing that lately the national debt had become a matter of increasing interest to the general public and, while some commentators had denounced borrowing by the Government, “such denunciations have tended to be emotional or dogmatic rather than rational.”

The National Debt at March 31, 1966, was £1,127,982,565 an increase of £58,190,525 for the year, according to the Auditor-General’s report for the vear which ended on March 31, 1966.