GERMANY’S DEBTS

Dominion, Volume 27, Issue 301, 17 September 1934, Page 9

GERMANY’S DEBTS

British Delegation to Visit Berlin EFFECT OF NEW SYSTEM (British Official Wireless.) (Received September 16, 5.5 p.m.) Rugby, September 14. The Foreign Office announces that it has been agreed between his Majesty’s Government iu the United Kingdom and (he German Government that a delegation headed by Sir Frederick Leith Ross, Chief Economic Adviser to his Majesty’s Government, shall proceed immediately to Berlin to instigate discussions on the commercial and financial relations of the two countries as affected by the new German machinery for the control of imports and the allocation of foreign, exchange. The effect of the recent decrees issued by the German Minister of Economics, Dr. H. G. 11. Schacht, has been subjected to close examination during the past few days with particular reference to their bearing on the AngloGennan exchange agreement which was signed as recently as August 10, and came into operation on August 20. In accordance with these decrees, full control will be exercised over all imports into Germany as. from September 24. The machinery for operating the control provides fpr estimates being made in advance of the amount of foreign exchange likely to be available each month and limitation of that month’s imports, - strictly controlled by the issue of permits, so that payments may be met within the estimate. Important Changes. Two important changes are introduced by the new system. First, the control applies not only, as in the past, to raw materials, but to imports generally, and secondly, the new machinery will Involve the abolition of the general exchange permits which formed the basis of the recent Anglo-German agreement. In these circumstances discussions with the German Government are generally considered necessary to discover in greater detail how the new machinery will function, whether the recent AngloGerman agreement can continue to op-, erate under the new regulations, and, if not, whether it is desirable to substitute for it a fresh agreement. Now that Lancashire spinners have refused the terms offered by Germany for tho repayment of outstanding debts, the whole question of the repayment of Germany’s existing commercial debts to Britain remains unsettled, and it is generally expected that this matter will be raised in the Anglo-German discussions. In an article written before the announcement that a delegation would go to Berlin, the "Daily Telegraph” stated that the object of such negotiations would be to seek to define entirely a new basis for the whole of the commercial relations between Germany and the United Kingdom. / German Offer Unacceptable. In connection with the discussion of broader issues intention is directed to .the decision of the Lancashire cotton spinners to reject the German proposals for a settlement. The decision has caused but little surprise in newspapers reflecting commercial opinion, as the proposals are generally regarded as most unsatisfactory. The view is expressed That, if accepted, these terms might have resulted in an increase of the total German obligations without providing any certainty that the full amount would be liquidated. The “Daily Telegraph” says that the view in official quarters is that any agreement reached should provide beyond question for a reduction and not for an increase’of existing indebtedness. The “Financial News” says that, if rhe terms had been accepted, British exporters would have become even more Involved in Germany than at present, since a resumption of normal deliveries would probably mean that their value would exceed the repayments to be made by instalments on outstanding 1 debts. The newspaper considers it probable that the British Government will now formally assume responsibility for future negotiations. • The wool cotton-and coal industries, a Press Association cable states, appointed a deputation to see Mr. W. Runeiman, President of the Board of Trade, on September 17 regarding Germany’s debts.