GERMANY'S DEBTS

Evening Post, Volume CXVII, Issue 127, 31 May 1934, Page 11

GERMANY'S DEBTS

THE MAIN DIFFICULTY

TRANSFER, NOT INCAPACITY

OFFER TO CREDITORS

United Press Association—-By Electric Tele-

graph—Copyright.

BERLIN, May 30.

The Debts Conference concluded after granting a sis months' moratorium on German debts.* A communique states that creditors excluded the Dawes and Young Plan loans from the discussions and agreed with Germany that the difficulty is transfer rather than incapacity to pay. A S3'stem of furthering additional exports by the purchase of external bonds or debts was discussed. It was agreed that no such purchases should be made except for procuring additional foreign exchange by additional exports and that, as far as practicable, tho method at present employed, by, foreign exchange, should be maintained. The conference decided that Germany should make an' Offer to creditors.' In accordance with the conference decision the Beichsbank announced conditions regarding the transfer of interest on Germany's long and medium term ' non-Reich debts^ Payment will not be subject to tho operation of any transfer restriction, but, since ability to pay depends on the foreign exchange available to Germany, the Beichsbank reserves the right to withdraw the offer of such cash payments at 30 days' notice. The Eeichsbank will make every effort to arrange its foreign currency so that cash payments can be made. It will increase the agreed 40 per cent, proportion if possible. DELEGATES DIFFER. The--English, French, and Swedish delegates rccoxniaeiidecl the acceptance of the_ offer provided the requirements of tlieir Governments regarding service on Reich loans were satisfied. The Dutch and Swiss, delegates refused acceptance. America will not discriminate for creditors of any country nor agree to a cessation of separate agreements. The Eeichsbank offers funding bonds for coupons maturing on non-Reich debts in. the year following June 1. The bonds will bo guaranteed by the Reich and will mature on January 1, 1945, and will bear interest at 3 per cent., payable in the foreign currency of the original bonds. The sinking fund is 3 per cent., so that the total service is 6 per cent. Tho delay is designed to facilitate the operation of the supplementary export system. ; . The "Daily Mail," referring to the moratorium, says- that Germany's financial position is steadily becoming worse. The Reiehsbank's gold reserves are seriously depleted and exports are steadily decreasing, while the mysteriously heavy traffic in German bonds aggravates the situation...