EXCHANGE PROBLEM

Evening Post, Volume XCIX, Issue 122, 24 May 1920, Page 8

EXCHANGE PROBLEM

TO THE EDITOR. Sir, —From your Teport published in The Post containing opinions expressed by several business men of the city concerning some remarks made by Sir Joseph Ward on "Finance,"' the following is an extract:—"As it is, we have long had excellent arrangements with the United States and Canadian banks, and they afford the facilities required." Without presuming to go into the question of which is the best method (if there is any.best) to comblit the high rate of exchange, I give tho following instahcec which came under my notice recently, and question if your business man was correct in calling the present ' arrangement as "excellent": —A Wellington importer bought iron pipe from a- Canadian manufacturer with headquarters in Toronto. r The original invoice was made out in dollars and tho total shown as £344 4"s sd, exchange in Torontosat 4.80. The goods were sent to New York, and from there shipped direct to Wellington. The invoice wns also sent to New York, and a draft made on Wellington with" exchange at 4.05, equal to £407 19s 4d. The importer was thus taxed to the extent of £63 14b lid by reason of the Canadian manufacturer drawing through New York instead of direct from Toronto. Can you explain why this procedure is followed, and whether it is an "excellent arrangement" ? —I am, etc., ■ INQUIRER. 22nd May.