TRADE DIFFICULTIES

Evening Post, Volume CXII, Issue 122, 19 November 1931, Page 12

TRADE DIFFICULTIES

OUR ADVERSE BALANCE SUGGESTED REMEDIES PARALLEL IN BRITAIN We have three methods of adjusting our unfavourable trade balance — increasing exports, reducing our imports, or our borrowing. Borrowing is not favoured just now, our exports cannot be increased very rapidly, and it looks as if our imports must be reduced. This summary of New Zealand's adverse trade balance was advanced by Mr. L. A. Paißh, H.M. Trade Commissioner in New Zealand, when dealing before the British (U.K.) Manufacturers Association of New Zealand yesterday with the trade difficulties which followed Britain's removal from the gold standard some months ago. "We were literally knocked off the gold standard," he said. "No country goes off it willingly. It was caused by financial nervousness on the Continent and the withdrawal of short-term money from. London. It was necessary if we were going to save anything at all. It is going to harm our import trade at Home and must affect the cost of living figures, but it is pleasing to see that tfye position is being- tackled with characteristic resource by the Government which has been given a large—perhaps too large—majority in tho House of Commons." The trade balance of Great Britain had been unfavourable, and would have been much worse if something had not been done to stop the rot. At the present time Britain was faced with the unusual spectacle of men like Mr. Walter Bunciman seeking power to impose up to 100 per cent, ad valorem duty on certain goods. Mr. Paish hoped the effect of this would be to reduce imports, to balance the trade figures, because any great expansion of exports was impossible just now. Britain could not reduce its raw material imports, of course, but thero were many wholly manufactured products now being imported which the Old Country could well do without. "I am satisfied that the pound sterling will get back to its old stable level," Mr. Paish said, "but this will probably take some considerable time." Turning to the similarity between British and New Zealand conditions, Mr. Paish said this Dominion's adverse trade balance could be rectified by borrowing in London, or by an increase in the depreciated rate of exchange, which from the importers' viewpoint was a bad tendency. He hoped the alternative method of internal adjustment would be undertaken, namely the reduction of imports. This reduction he hoped would be in tho commodities now brought from foreign countries. It was likely to happen thus, because those foreign countries which were supplying New Zealand with goods were still on the gold standard and suffered a disadvantage on exchange.