KNOTTY PROBLEM

Evening Post, Volume CXXVI, Issue 132, 1 December 1938, Page 10

KNOTTY PROBLEM

IMPORTS AND FUNDS

RATIONED EXCHANGE?

CUSTOMS HUSH-HUSH

Importers, manufacturers, wholesalers, and retailers who have their P9|ticular interests at heart are won* dering what (if anything) is going to be done about imports. They have scanned the general statements of Ministers for details or material for forming conclusions and basing thereon their business policies, but generalities are not enough. It is reported that the Customs Department is particularly busy just now. All leave has been suspended; there is too much to do and that has to be done in a hurry. Application has been made for official confirmation or contradiction of the report, but none was obtained. It *is not usual at any time for information of changes in Customs duties to be disclosed before they come ( int<> operation. Official refusal to discuss changes of this kind is only to be expected. But business men conning banking and Customs returns are aible to make certain deductions therefrom. They have been doing so—and acting accordingly. The latest available returns of external trade are those for the nine months ended September. 30 last, issued by the Customs on November 3. They are as follows:— " v Excess 9 mths. Exports. Imports. Export* ended i £NZ £NZ £NZ September - 1938 ... 48,097,000 41,604,000 6,493,00t 1937 ... 55,284,000 41,982,000 13,302,009 ' 1936 ... 46,042,000 31,885,000 14,157,00» The above figures take no account of specie, movements. Business men have noted the decline in the credit balance of trade from £13,302,000 last year to under £6,500,000 this year. They have noticed, too, that whereas the Reserve Bank had sterling funds amounting to j £17,148,967 (in N.Z. currency) on November 1 last year, the total at November 21 of this year was down to £5,029,137; and the trading banks* funds in London (also in N.Z. currency) were over £6,500,000 at November 29, 1937, and these had shrunk to £4,115,000 at the end of October last WHAT THE FIGUBE& SHOW. Putting these two trade indicators together, it was naturally deduced that "something must be done." But what? Scanning the speeches of Ministers disclosed no detailed information but confirmed the belief that measures were to be taken to adjust the sterling exchange position. Then questions arose in the business mind, "If imports are restricted how will Great Britain, New Zealand's best customer, take it? What will New Zealand manufacturers arid other industrialists'do if supplies of raw and partly-fabricated materials are* curtailed? Incidentally New Zealand trade with Great Britain is lopsided. Oh the recent showing of' Sir Granville Gibson* M-P-ri^e* sident of the Association of British Chambers, of Commerce, New Zealand ~. sold to Great Brtain goods to the value/--' of £28,000,000 (sterling) and bough£' from Great Britain goods to the "v^lwft of £9,000,000 (sterling). There dfoes not appear to be any room for jburtailment of imports from Great Britain on these figures. . -| But New Zealand's requirements' are met by other countries and/ with some of these its trade balance isV well against it. "■'." \ COST OF LIVING. { If the present rate of exchange ffew Zealand on London, £125 in New Zealand equalling £100 in London,] is raised—and. the Government pledged itself tp reduce that rate—another \ obstacle is raised against import:; from Britain and elsewhere, and the jcost will be added to the goods, and 1 so the cost of living in New Zealand iyill be further increased in so far as fimported goods are concerned; moreover, the costs of locaUy-manufacttired goods are1 usually approximated! to > those of competitive imported goods. Control of exchange is thought Iby business men to be a possibility, (but it is a difficult, even risky, thing If or any country to do, leading to complications, even to distress in some {instances, and possibly the discharge lof employees, through, contraction in tthe volume of business. . ! The present obscure future of the import trade is giving many who are engaged in it much concern. Planning is out of the question. The approach of Christmas is keeping distributing houses busy, but the problem which executives are finding it, hard Uo solve is what is the best course Intake for 1939, and what is to happeta, next, and, perhaps, soon? . V .