PROGRESS AT OTTAWA

Dominion, Volume 25, Issue 264, 3 August 1932, Page 9

PROGRESS AT OTTAWA

Continuation Expected CURRENCY POLICY Sub-Committee’s Report EXAMPLE OF BRITAIN (By Telegraph.—Press Assn.—Copyright.) Ottawa, August 1. It is expected that the Imperial Economic Conference, when it resumes to-morrow, will continue rapid progress, but on none of the vital issues can it reach a decision in this short week, which will close on Thursday. The British Chancellor of the Exchequer, Mr. Neville Chamberlain, reviewing the'proceedings to date, said to-day that he cherished the highest hopes of a successful outcome.

The currency sub-committee’s report will probably be ready for the Conference at the end of the week. While there is no official indication of the probable solution of the monetary problem, there Is a general feeling that the policy of the British Government and the Bank of England in the past three months has been absolutely right, everybody in Conference circles cordially agreeing with it For several months after Britain left the gold standard, apparently neither the British Government nor the Bank of England had a definite future policy. Thus interest rates remained at 5 to 6 per cent., which meant dear money. For the past three months the Bank of England, with the obvious concurrence of the Government, has been pursuing a policy of reducing the discount rate, which is now the lowest in history, meaning cheap money. The second factor in the situation, which is also regarded with the utmost approbation in Conference circles, is Britain’s conversion of the £2OOO million 5 per cent war loan to 3} per cent Thus a low bank rate means a cheap Interest rate for short-term securities and a lower War Loan interest brings a cheaper rate for first-class long term securities. / Exchange Equalisation. The third factor Is the establishment of the £l5O million exchange equalisation fund, announced in the British Budget which represents the Government’s definite determination to prevent speculators interfering with the exchange position. There is a tremendous amount of international short term money which in other conditions would have been directed to long term investment avenues. This involves the movement of vast volumes of International money from one country to another, causing violent exchange fluctuations, upsetting equilibrium by heavy flooding or equally heavy withdrawal. Britain has suffered twice in the past year by reverse processes. Whereas the withdrawal of a large amount of short term money from Britain was a big factor in forcing her off gold, she has been equally embarrassed in the past few months by an inflow of a great volume of international short term money. The fluctuations in exchange have been caused more by the movement of this short term money than by the actual balances of trade between countries. Whether the stabilisation fund of £l5O million is sufficient has not yet been demonstrated. Nevertheless it will be a big factor in checking the instability of sterling exchange in relation to the gold dollar. The question is being discussed in Conference circles whether Britain will indicate with sufficient definiteness that this recent policy will be steadfastly pursued, whatever happens; also whether Britain can do anything more. Butter, Meat, and Fruit. The British and Dominion Government officials continues their examination of the butter, meat, and fruit proposals. Mr. Richardson and Mr, McDougall are representing Australia and Drs. Craig and R. M. Campbell New Zealand. The newspapers wrongly describe Mr. Havenga’s statement yesterday as “the first note of discord” because he referred to the trade position in relation to gold, as stated in Mr. Baldwin’s document, as “clearly fallacious.” The South Africans do not intend that their arguments should be construed as containing the slightest hint of hostility. They merely desire that the Union’s trade position should be seen in a truer perspective. Canada’s Concessions. Canada has not yet disclosed fully the concessions she is willing to grant Britain. Her wheat policy is still undecided, but it is believed that the Prime Minister. Mr. R. B. Bennett, will adhere to his request for preference, seeing that this, apart from the preference on pork and bacon, which would stimulate the pig industry, represents all the Prime Minister could offer the Western farmers. Australia awaits Canada’s wheat decision with same interest, because, whatever Canada may ask, Australia will give it solid backing, inasmuch as the Commonwealth is not making wheat one of its main planks. Broadcast from TheipvaL The delegates assembled at Parliament House to-day took seats in the Chamber and heard an impressive broadcast of the Prince of Wales’s unveiling of the Theipval Memorial. Reception was remarkably clear. Later Messrs. S. M. Bruce and J. G. Coates repeated their opening speeches before a sound camera for a talkie film, remedying earlier technical defects. DELEGATES RELAX Ottawa a Beautiful City Ottawa, August L Ottawa is revealing herself to the Conference delegates during the interval in their labours as a beautiful city. Its wide sweeping river, which becomes a great frozen sleigh thoroughfare in the winter months, now carries a busy traffic of river boats, barges, pleasure launches, and canoes. Several canoe clubs dotted on the banks have a fashionable membership. These resorts are popular also for tennis and dancing. The delegates have yielded to the allurements of the French quarter of the city, named Hull, just across the river In the Quebec Province, where liquor restrictions are relaxed and there is a brighter night life. The Chateau Laurier is one of the best hotels in North America, luxuri-

expensive, but the official delegates are guests of the Canadian Government. Parliament House stands majestically on Parliament Hill behind the Chateau, five minutes’ walk over Rideau Canal, joining the Rideau and ‘Ottawa Rivers. Here crowds watch stumpy canal boats going through a series of six locks, similar to those on the Thames and Murray. The spacious Parliament grounds, with wide terraces, made an ideal setting for the pageantry of the opening ceremony. Now red-coated Royal Canadian Mounted Policemen, revolver holsters in their belts,- continuously pace the paths. Delegates and pressmen are required to present their cards on admission to the bunding, whose 500 rooms, vacated by members of the House of Commons and Senate, are entirely occupied by Conference delegates with their numerous staffs. Mr. R. J. Manion, Minister of Railways, of Irish descent and a breezy manner, presides at the Press interview twice daily and endeavours dutifully to make bricks out of strawless communiques. This studied official silence is inevitably responsible for columns of newspaper articles based on lobby gossip, but it is expected that the communiques will shortly contain some