U.S. FAVOURS GOLD

Gisborne Herald, Volume LXX, Issue 21064, 8 April 1943, Page 4

U.S. FAVOURS GOLD

BASIS OF VALUES

STABILISATION FUND WORLD MONETARY UNIT (By Telegraph—Press Assn. —Copyright.' (10.30 a.m.) WASHINGTON, April 7. Outlining' the United States Treasury’s post-war currency stabilisation' proposals, the Secretary o£ the Treasury, Mr. Henry Morgenthau,. declared that machinery would be established when two-thirds of the United Nations and their associate? agreed upon the procedure and eppr'dssod confidence that, at a given time, an, agreement could be reached. The 4000,-vyuvd plan reveals that the Upiti’d. States would exercise power of veto—a provision which is likely to arouse serious opposition in Britain, where the House of Commons is, due to consider a counter-plan drawn up by Lord Keyes.

The decision of the board will be by' a" simple majority, except, that imjpqrtqnt operations will require a vote of 80'per cent. Th'ej United States proposes to conr tribute' £500,000,000 and presumably wilj be entitled to 25 per cent of the voting, power. Thus, the United Stale's could prevent other member's rpuptering the needed 80. per cent oj the’ votes' on vital issues. Five-Point Programme

plan follows substantially, the fqllowing five points: First, the estabjli'slpjfirit. of an international stabili isatidn fund to be taken part in by ajl the United Nations and eouptne? associated' with them who contributed to tiie-fund; secondly, the creation of an international board to control the} fund" with the participating nation? appoffttiftig, members and; with voting pow,er on the board fixed according to,each .country’s contribution; thirdly! aA agreement among members not to engage in competitive depreciation, of their currencies;'. fourthly, the attain-; ment of stability by fixing the values of , currencies in terms of gold; and} fifthly,the. retention of established) channels of .international trade and international banking for all inter-* national transactions.

Members; ; will be required to’makq initial payments to a fund of at least half the total subscriptions' in gold! currency or Government securities. Mr. Morgenthau explained that the fund will not. constitute an inter-! national bank. It would not lend money. However, it would eliminate the need for individual exchange con-!, trol funds which may be used to; finance the new fund.

The primary object of the pfos posa'ls, which are highly tentative), was to assure rapid transition from war-time restrictions on trade, esped-j ally to allow, the war-ridden to obtain foreign exchange with which to. restart trade immediately after the war.

International Money Unit

The proposed new 10 dollar international monetary unit, called Unitasi would not be issued in the form of notes and coins. Members would deposit gold for credit in unitas which) would be redeemable by gold and transferable between members.

Mi - . Morgenthau added, that thcj United States wanted an agreement to emerge from the impending confer-, once, but it did not wish to act thcj part of a big or rich brother, ten ouf of the 37 nations invited to the conference had thus far responded enthusiastically. The- New York Times correspondent! In Washington says the most conspicuous difference between the Whitq and Keynes’ plans is apportionment) of the control. Under the White planit is on the basis of capital participation, whereas under the Keynes’! scheme it is pre-war trade, which would give Britain a greater voice, in control' since in 1938 British trade was around £2,250,000.000. compared) with the United States’ £1,500,000,000.