COMPROMISE REACHED

Evening Star, Issue 26043, 6 March 1947, Page 8

COMPROMISE REACHED

TRADE WITH DENMARK BRITAIN MAKES NEW AGREEMENT (N.Z.P.A. Special Correspondent.) (Rec. 8 a.m.) LONDON, March 5. Commenting on the new British trade and payment agreement with Denmark, the ‘ Manchester Guardian’s ’ financial correspondent says that in it Britain has tackled some of the most difficult problems of her relations with the “ soft ” currency countries. Having exported more to these countries than she is able or willing to import, Britain can restore the balance either, by exporting less or importing more. A compromise has been reached in the case of Denmark with regard to both trade and prices. Denmark will export more food to Britain and import fewer goods so as to balance her payments with the sterling area for 1947. In order to make this possible, the British Government has agreed to pay a higher price for Danish . butter and bacon, while the Danish Government has agreed to restrict imports from Britain and the sterling area to “ essential requirements.” The ‘ Manchester Guardian ’ also remarks that at the prices Britain has been willing to pay—m her struggle to keep domestic prices stable .in the midst of heavy credit inflation—the Danish Government had to subsidise farmers. Now Britain will pay part of that subsidy. “ There is no great question of principle in that. It is not even certain whether food production has been discouraged by our refusal to pay more. What is certain is that we did not get the food. It was surely time to yield a little.”