PRICE OF U.S. AID

Grey River Argus, 18 September 1945, Page 5

PRICE OF U.S. AID

WILL IT BE STERLING BLOC?

SUGGESTED GOLD BOOM. LONDON, Sept. 15. A special correspondent of the Australian Associated P'ress stated: —- “Financial opinion in London is less confident about the outcome of the Washington discussions after the American reaction to statements by Lord Keyes and Lord Halifax, and the vital differences between the British and American Treasury approaches. London City circles see no great possibilities in bilateral trading pacts or exclusive sterling bloc arrangements. The city circles consider that, from Lord Keynes’ remarks. the British Labour Government is willing to “trade” the Ottawa preferences for a really liberal United States tariff plus American aid on an equality-of-sacriflce principle.

Banking quarters in London argue that the ’ alternative to multilateral trading suggested by the sterling bloc school of thought assumes a complete but perhaps an unwarranted confidence in the willingness, of sterling area countries to continue sending supplies to Britain on credit. This view does not necessarily coincide with opinions in Labour circles which are largely attracted to bulk purchasing arrangements, especially with the Labour administrations in Australia and New Zealand. Commodity market and other private enterprise, interests contend that such arrangements are diametrically opposed to American Government ideas on external trade policy. Disinterested economic opinion forecasts. -at best an interest-free loan for Britain with repayment terms conditioned only by Britain’s balance of payments from year to year, as the most likely American offer of aid. There is a suggestion from a London stockbroker that gold production within the Empire could be increased to meet dollar shortage. His argument is that every ounce of gold produced would relieve tension and that, export of gold would lessen the need for export of goods directly needed for home consumption.