BRITISH INDUSTRY

Evening Star, Issue 23021, 28 July 1938, Page 11

BRITISH INDUSTRY

PRESENT CONDITION EXPORTS DECLINE NEW ZEALAND'S INTEREST New Zealand having a market in the United Kingdom for 76.50 per cent, of its merchandise cannot afford to regard British industrial conditions with indifference. Attributable in large part to higher industrial activity connected with rearmament, together with an improvement in business generally in Great Britain, the prices paid for New Zealand food products, principally meat and butter and cheese, for the past 12 or 18 months were on a basis payable to the producers. Will they continue to he so? The answer depends upon the_ condition of industry in the United Kingdom being at least as good during the 12 months ended June 30, 1939, as they have been. But certain recent indications of recession in industry—not those connected with rearmament—have been noticed and commented upon. One of those indications is the slackening off of the British export trade. Returns of the Board of Trade for June, 1938, show a reduction in value of visible exports when comparison is made with returns for June, 1937. The position fpr -the .first half qf-this year, showing: the difference with that of 1937, was as follows; C inos., 1938, 6 mos., 1937. £ £ Exports and rc-ei-ports 366,108,224 291,767,593. Imports ‘ 470,306,283 483.422,060 Excess imports 204,198,059 191,654,467 “ Invisible exports ” represented by interest payments, earnings of shipping, and other companies operating outside the United Kingdom, must be taken into consideration, although it is impossible to do more than estimate what these may amount to in the aggregate. They vary from year to year, but according to the address of the Marquess of Lothian, Governor of the National Bank of Scotland, “ as a result /of our accumulated investments abroad, we could rely, as a nation, upon an income from abroad of about £250,000,000 annually.” EXPORTS CONTRACT. British exports of manufactured goods shrank during the first half of this year, according to Lloyds Bank, and the contraction was noticed principally in cotton and wool yarns and manufactures. The same authority (June review) noted that ‘‘ there has been no recovery in the United States Argentina showed a seasonal falling off in exports of primary products; Germany had experienced a contraction of exports; and Scandinavian countries reported “ less hopefully.’^ Dealing with British industry in general, Lloyds Bank noted that wholesale prices were falling and shipping freights weaker. Electric power consumption was well maintained. There was a moderate but sustained demand for industrial chemicals. Employment in the building trades kept up well, but plans passed last April were in value 24.1 per cent, below those of the previous year. ” It looks as if the industry has become increasingly dependent upon Government contracts. “ Railway goods and coal traffic receipts have been shrinking. IS RECOVERY DEFERRED? “A month ago it was suggested that the long-term outlook appeared a little more favourable, but that recovery would take time to develop. Since then fresh tension has developed in the international political field, and this is bound to affect the course of business. On the other hand, more recent indications suggest that the downward trend of business may have been partially and temporarily checked during May, though the weakness of commodity prices and the dearth of new orders in many trades are ominous factors. To-day it looks as if recovery has been deferred at least until the autumn and more probably until next year. In the meantime, a further recession must be expected, which will only lie partially offset by the relative activity in those industries employed ou rearmament.”