EMPIRE CONFERENCE

Evening Star, Issue 21170, 2 August 1932, Page 9

EMPIRE CONFERENCE

OTTAWA’S HOSPITALITY DELEGATES ENJDY INTERMISSION STUDIED OFFICIAL SILENCE Press Association—By Telegraph—Copyright. OTTAWA, August 1. (Received August 2, at 11 a.in.) The delegates are taking advantage of the glorious sunshine to visit some of Ottawa’s conveniently-situated picnic places. It is expected that the conference, when it resumes to-morrow, will continue its rapid progress, but none of the vital issues can reach a decision in this short week, which closes on Thursday. The newspapers wrongly describe Mr Havenga’s statement yesterday as “ the first note of discord ” because he referred to the trade position in relation to gold, as stated in Mr Baldwin’s document, as “ clearly fallacious.” The South Africans do not intend their arguments to be construed as containing the slightest hint of hostility, but as merely a desire for the Union’s trade position to be seen in a truer perspective. Mr Chamberlain, reviewing the proceedings to date, said to-day that he cherished the highest hopes of a successful outcome. Canada has not yet disclosed fully the concessions that she is willing to grant Britain. The wheat policy is still undecided, but whatever Canada may ask Australia will give it solid backing, inasmuch as the Commonwealth is not making wheat one of its main planks.

Anglo-Dominion Government officials continue the examination of the butter, meat, and fruit proposals, Mr Richardson and Mr M’Dougall representing Australia, and Mr Craig and Mr Campbell New Zealand.

Ottawa, is revealing herself to delegates during the intervals in their labour, as a beautiful city/ The wide, sweeping river, which becomes a great frozen sleigh thoroughfare in the winter months, now carries a busy traffic of river boats, barges, pleasure launches, and canoes. Several canoe clubs are dotted along 1 the banks, with fashionable memberships. These resorts are popular also for tennis and dancing. The delegates have yielded to the allurements of the French quarter of the city, named Hull, just across the river, in the Quebec province, where the liquor restrictions are relaxed, and there is a brighter night life. The Chateau Laurier, one of the best hotels in North America, is luxuriously appointed and proportionately expensive, but the official delegates are the guests of the Canadian Government.

Parliament House stands majestically bn Parliament Hill, behind the Chateau, five minutes’ walk from the Rideau Canal, which joins the Rideau and Ottawa Rivers. Here crowds watch tlie stumpy canal boats going through a series of six locks similar to those in the Thames. A party of delegates was amused at hearing a mother calling to her children: “ Come and see the steamer going down stairs.” The spacious Parliament grounds, with their wide terraces, provided an ideal setting for the pageantry of the opening ceremony. Now red-coated Royal Canadian Mounted Policemen, revolver holsters in belts, continuously pace the paths. Delegates and pressmen are required to present their cards for admission to the building, whose 500 rooms have been vacated by commoners and senators, and are now entirely occupied by the conference delegates and their numerous staffs. Dr Manion, Minister of Railways, who is of Irish descent and preserves a breezy manner, presides at the Press interviews twice daily. He endeavours dutifully to make bricks out of strawless communiques. This studied official silence is invariably responsible for columns of newspaper articles based on lobby gossip, but it is expected that the communiques will shortly contain some news.

BRITAIN'S FINANCIAL POLICY TRAVERSED OTTAWA, August 1. (Received August 2, at noon.) Mr Bruce spent the holiday preparing for to-morrow’s meeting of the Currency Sub-committee, whose report will probably, be ready for the conference at the end of the week. While there is no official indication of the probable solution of the monetary problem, there is a general feeling that the policy of the .British Government and the Bank of England during the past three months has been absolutely right, everybody in conference circles cordially agreeing with it. Several months after Britain left the gold standard apparently neither the British Government nor the Bank of England had a definite future policy. Thus interest rates remained at 5 to 6 per cent., which meant dearer money. During the past three months the Bank of England, with the obvious By special arrangement Reuter’s World Service, in addition to other special sources of information, is used in the compilation of the overseas intelligence published in this issue, and all rights therein in Australia and New Zealand are reserved. Such of the cable news on this page cs is so headed has appeared in ‘ The Times,’ and is cabled to Australia and New Zealand by special permission. It should be understood that the opinions are not those of ‘ The Times ’ unless expressly stated so.

The international cable news appearing in this issue is published by arrangement with the Australian Press Association and the ‘ Sun ’-'Herald ’ [Jews Service Limited.

concurrence of the Government, is pursuing a policy of a reduction of the discount rate, which is now the lowest in history, meaning cheap money.

The second factor in the situation—which is also regarded with the utmost approbation in conference circles—is Britain’s conversion of the two thousand million 5 per cent, war loan to 3£ per cent. Thus the low bank rate means a cheap interest rate for shortterm securities and the lower war loan brings a cheaper rate in first-class longterm securities. A third factor is the establishment of the £150,000,000 exchange, equalisation fund, as announced in the British Budget, which represents the Government’s definite determination to prevent speculators from interfering with the exchange position. There is a tremendous amount of international shortterm money which under other conditions would have been directed to longterm investment avenues. This involves the movement of vast volumes of international money from one country to another, causing violent exchange fluctuations and upsetting the equilibrium by heavy flooding or equally heavy withdrawals. Britain suffered twice during the past year by reverse processes. Whereas the withdrawal of a large amount of short-term money from Britain was a big factor in forcing her off gold, she was equally embarrassed during the past fenmonths by the inflow of a great volume of international short-term money. Fluctuations in the exchange have been caused more by the movement of this short-term money than by the actual balance of trade between countries. Whether the stabilisation fund of £l5O/000,000 is sufficient has not yet be'en demonstrated; nevertheless it will be a big factor in checking the instability of the sterling exchange in relation to the gold dollar. The question is being discussed in conference circles as to whether Britain will indicate with sufficient definiteness whether this recent policy will be steadfastly pursued whatever happens, also whether Britain can do anything more. HONOUR FOR MR BRUCE . OTTAWA, August 1. (Received August 2, at 11 a.m.) Lord Blanesborough telegraphed to Mr Bruce that he had been elected an honorary bencher at Lincoln’s Inn. CURRENCY AND ALLIED PROBLEMS OTTAWA, July 31. The early stages of the discussion on the monetary problem indicate that it is probably fortunate that ‘ the conference holiday arrangements will give time for the incubation of the ideas which have been outlined. The utmost secrecy is being observed regarding the trend of the suggested action, because if any hint was disclosed it might conceivably embarrass Britain if she was involved in a volte face or amendment of the original proposals at the dominions’ behest. Moreover, premature predictions of the final scheme might entail world-wide repercussions. If a policy is adopted which means general curtailment of production it is difficult to imagine what may happen.

Economists are walking the corridors with a consciously important air. They have now taken their places under the spotlight down stage. Everybody in the select audience is weighing their words. Even if, as is anticipated, the preliminary currency speeches are released on Tuesday in an abridged form they will not contain a single word of the plan that is now being discussed, and they will merely outline the sorry plight of the dominions and embrace a review of Britain’s returning financial health. It will show Australia and India developed in a common tie out of common distress.

The present interregnum in official business does not mean a complete stoppage of progress; on the other hand, it means accelerated activity on the part of the sub-committee which is reviewing currency problems. The experts are accomplishing really effective work during the week-end. They have been asked two questions—First, is it advisable and practicable to raise commodity prices; if so, how? Secondly, is it advisable and practicable to stabilise exchanges; if so, how? It is agreed that answers cannot bo furnished within a few days., The report will involve the most serious consideration of any subject before the conference. The heads of delegations especially realise their deep responsibility, and it is unlikly that any essential progress towards a decision will be made until next week, after the delegates have returned from the Niagara trip.

CONFERENCE SIDELIGHTS OTTAWA, July 31. Some remarkable and sometimes mischievous guesswork has been noted in articles appearing in American newspapers, notably a suggestion that Britain, instead of extending preferences, will cancel portions of her dominion indebtedness. How such a plan could assist the primary producer to sell his goods profitably it is impossible to see. Besides, apart -from the war debt owed to the British Government, all the dominion loans represent debts to private lenders in the London money market. Indeed, if all ibe dominion loans were suddenly wiped out it would not be a remedy, and could not be compared with the effectiveness of the provision of preferences, enabling the primary producer to evade complete ruin, whither he has been descending during the past two years.

Another suggestion which has been given harmful prominence in New York is that the dominions are asking Britain to reduce her imports of Argentine chilled beef by 45 per cent. The dominions’ meat proposals include a quota, but they do not specify any hard and fast figure or what should be taken oil the Argentine imports. It merely expresses a desire that the dominions should ho given a better chance of securing payable prices

in what is now a saturated market. There is a suggestion, however, that Britain should reduce her imports of foreign frozen meat by 37$ per cent., which it is calculated will afford Australia and New Zealand infinitely more favourable marketing conditions. A friend, brandishing a local newspaper, addressed Mr Bruce as follows ; “ I see you are going to the House of Lords earlier than we expected.”

A newspaper article developed the idea that Mr Bennett would shortly have a peerage as Canadian representative on the projected Imperial economic general staff, which may supersede the Empire Marketing Board and the Imperial Economic Committee. The writer displayed a remarkable misconception of the British constitutional structure when ho linked this proposed economic executive with the Privy Council and deduced that members thereof must be elevated to the peerage.

Opinion is veering to the view that the conference, despite early rapid progress, cannot finish before the end of August. It is unlikely that the British delegates will be able to occupy the berths they have booked on the luxurious liner Empress of Britain, which is to leave Montreal on August 26. It is feared, however, that if the conference lasts much beyond that date it would almost bo an admission of failure, but it is doubtful whether, within three weeks, the monetary problem, which is now seen as the paramount item, can bo solved or taken to a stage where postponement to a wider conference would be agreeable to the Empire delegations.

The New Zealand delegates, except Messrs Forsyth and Davis, the London representatives respectively of the meat and dairy boards, will return homo immediately after the conference.