CONTROL OF TRADE

Evening Post, Volume CXXVI, Issue 143, 14 December 1938, Page 10

CONTROL OF TRADE

NEW ZEALAND ACTION

EFFECTS ON AUSTRALIA

(From "The Post's" Representative.) SYDNEY, December 9.

Great publicity has been given in the Australian Press to the measures taken by the New Zealand Government to control trade and exchange. Comment has been sympathetic towards New Zealand in difficulties which Australia faced seven or eight years ago when its London funds shrank dangerously, but it also is critical of the domestic policy which has brought about the need for the stringent measures. Australian traders are deeply concerned at the effect the trade restrictions will have on Australian goods. In the quarter ended September 30, New Zealand was Australia's third best customer. Australians exports to. New Zealand in the year ended June 30 were £7,100,000. Her imports from New Zealand were only £1,900,000. Professor T. Hytten, economist to the Bank of New South Wales, said: "New Zealand has complete power over her trade policy with Australia, as those figures show. To build up her London funds, which have seriously declined, the New Zealand Government intends to divert as much trade as possible to Britain. It .seems inevitable that Australia will suffer to some de^ gree, because obviously she has so little bargaining power." *

Professor Hytten said that if trade and exchange restrictions between Australia and New Zealand were to continue, some sort of exchange equalisation account or barter agreement would have to be devised. "In this way it would be possible to keep trade going and prevent one country's currency depreciating in terms of the other's," he said. "Once started, import and export controls, such as New Zealand has adopted, lead to serious effects of other kinds, which have, ultimately, to be provided for."

The main Australian industries that will be affected by the New Zealand restrictions are metals and machinery, timber, textiles, paints, coal, and fruit. The New Zealand Department of Trade and Industry has informed Australian shippers that goods on the. water by December 5 and goods ordered before that date if imported by December, 31 will be admissible without licence.