TO UNITE TRADE AREA

Dominion, Volume 38, Issue 306, 25 September 1945, Page 7

TO UNITE TRADE AREA

Hope Of British-U.S.

Agreement ticklish problems (Received September 24, 11.50 p.m.) NEW YORK, September 24. Washington officials confidently predict that the current British-American talks will result in an agreement giving the United Kingdom, and the British Commonwealth sufficient do!hns to unite their trade area with the American and avoid a division of the world into two intensely competitive currency spheres, says the “New York Times” correspondent. I his would mean a much earlier than otherwise return to normal multilateral trade. One of the most troublesome problems of the negotiations is what to do about the 14,000 million dollars worth ot blocked sterling balances which have pilled up in London during the war as a result of British war purchases throughout the sterling area and Britain s inability to endow these balances with either convertibility into more desirable currencies or translation into purchasing power in terms of British manufactures. , , Two ticklish problems. are how to finance the Amercan credits in a form acceptable to American public opinion and what to do about persuading the sterling area countries to cancel at least a substantial part of the sterling debt. It is generally felt in Washington that an outright gift would be repugnant to the American people and that at least a token rate of interest must be charged, if only to pay expenses, as a kind of service charge.

From a strictly economic point of view the money, however it is provided, will not remain out cf the United States since it will be used to purchase goods from America. Canada holds none of this sterling debt, having made an outright gift to the United Kingdom of its war aid. , , , . American official circles expect that as soon as the British get a reasonably acceptable American proposition, they will contact the sterling area, probably while the negotiations are still continuing, to see what they might do in return for American assistance.

LEND-LEASE ORDERS Cancelled By Britain

(Received September 24, 11.45 p.m.) WASHINGTON. September 23.

Britain, in a belt-tightening move, has cancelled over 50 per cent, of 1,500,000,000 dollars worth of Icnd-lease goods she had on order on VJ-day, says the American Associated Press correspondent. A British Supply Council spokesman said the action was dictated by Britain s desire not to assume additional debts till the financial outlook was determined by the current talks. > No food orders were cancelled, but many orders for tobacco, raw materials and manufactured . goods were cither scaled down or eliminated.