WORLD TRADE

Evening Post, Volume CXVII, Issue 83, 9 April 1934, Page 12

WORLD TRADE

RECOVERY DELAYED

HEAVY LOSSES BY NATIONS

"Evening Post," April 9.

Obstacles in the way of recovery in the trade of the world are summarised by the Economic Intelligence Service of the League of Nations as follows: —

The instability of exchange rates, the

tremendous movements of gold reserves, ;mcl restrictions of exchanges are all elements that prevent the stabilisation of prices and the free development of trade. In these circumstances it is not yet possible to count upon a recovery of prosperity in international trade. The report shows that between 1929 and 1033— 1. The volume of goods exchanged declined by 30 per cent. 2. Gold prices fell 50 per cent. 3. Sterling prices fell 30 per cent. Combination of the indices of trade volume and prices shows that in 1933 the value of world trade/in gold, was less than one-third its value in 1029. "Even taking account of the fact that today the bulk of world trade takes place on the basis of paper money and that most international debts have been contracted in dollars or pounds sterling," the report adds, "the conclusion reveals that JJie value of world trade has been halved. On a gold basis most of the important countries retained in 1933 only about 3a per cent, of their 1923 trade. The United States retained only a quarter of its 1929 trade. COUNTRIES OFF GOLD. ■V very different picture is given when the trade of the countries-which have gone off'gold is calculated on the basis of their national currencies. Thus, in the four-, year period Japan's trade has declined by only 12% per cent., Australia's by 8 per cent and New Zealand's by 25 per cent. _ Iv other words, the trade of countries oil "old has diminished proportionately less than that of countries on gold, statistics further show that prices in countries on cold have increased, while prices in countries on gold have fallen to an extent corresponding to the changes in the volume of their trade. - ' „ Are there any signs of recovery.' V or answer the report says that it is significant to note that the total value of world trade did not fall so much in 1933 as in some previous years. Nevertheless, it continued to decline, compared with 1932, with the exception of December, when an improvement was,shown. SEASONAL INFLUENCES. It is further noteworthy that in 1033, for the first ■ time since 1020, the phenomenon of seasonal movements, so well known to all economists, reappeared. It is to this seasonal movement that the December increases should be attributed For the same reason a diminution may be expected for January and February, 1934. ' The statistics for 1933, the report concludes, appear to show that world trade is iv process of returning to a kind oi normality while remaining at a very restnet- ° In^Keneral, it is added, gold prices show a tendency to drop, and there is no clear sign o£ a rise in paper prices, at least in the United States. . The volume of trade shows a slight increase in certain special cases, lor example, in 1933 Great Britain imported 50 per cent, more raw wool, 33 per cent, more timber, and 12 per cent, more cotton than in 1932. , , Exports of manufactured goods, however increased by only 3 per cent as compared with 1932, thus showing that practically all this new production was absorbed m the home market.