BRITAIN'S PROBLEM (To the Editor.)

Evening Post, Volume CXL, Issue 52, 30 August 1945, Page 6

BRITAIN'S PROBLEM (To the Editor.)

Sir,—The chief questions raised in this country regarding Britain's position on the sudden cessation of lendlease- have been concerning the continuance of import control and the desirability of developing secondary industries in New Zealand. There is another side to this picture. The assumption that Britain desperately needs the New Zealand market for her manufactured goods is by no means to be taken for granted. She needs our primary produce, and we can and will send her as much as possible. But in her present position it is most essential for Britain to develop export markets in non-sterling countries to whom she does not wish to incur liabilities for essential imports, and it may well be that she will welcome relief from our demand for manufactured goods ,at least temporarily. . Britain's exporting industries, which enable her to pay us for our meat and butter and wool, depend to no small extent on imports of raw materials for processing, and those raw materials come not so much from the Dominionsas from non-sterling countries. _ To pay for these imports to maintain her manufacturing industries she must rapidly establish credits outside the sterling area In this she has been placed at an immediate disadvantage to the U.b.A. .by the stoppage of lend-lease supplies, and it is going to be most difficult for her to obtain her requirements from non-sterling countries without building up debts. The United States, with an unimpaired and virtually unlimited industrial capacity and a problem of huge potential unemployment, with a new but substantial leadership in merchant shipping tonnage, can become firmly established in European and other markets from which she requires little or nj material return and over which she will acquire all the advantages of the creditor. Our £80,000,000 in London is part of the £3,000,000,000 at-call liabilities which Britain has to face, and which handicap her in acquiring the means of payment to foreign countries from whom she must obtain supplies. This brings reciprocal trade into a new perspective. Britain needs our produce—but does she, in fact, want to pay us now with manufactured goods, sending her limited shipping on the lon« haul to the Antipodes when it could give her so much greater turnover to closer and more advantageous markets? Does she want us to help her by being patient, even supplying ourselves as - far as possible without calling on either dollar or sterling funds? Perhaps the only permanent solution to Britain's problem will be a transfer of population to the Dominions, and the development of local industry is certainly a prerequisite to such a policy.—l am, etc.. JOHN HOGAN.