GERMANY’S ECONOMIC PLIGHT.

Hawera Star, Volume LII, 5 September 1932, Page 4

GERMANY’S ECONOMIC PLIGHT.

Recent political events in Germany have been so startling 1 that attention has been drawn away from the econo mic condition and prospects of the country. Figures compiled by the German Market Research Board last December showed that the estimated national income of Germany was between 50,000 and 00,000 million Reichsmarks in 1933, as compared with 68,000 to 70,000 million in 1930 and 76,000 in 1929. The. reason for the decline is not far to iseek; but at the same time .it. must be remembered that the German national income was not near these figures in 3923, and that since then an extraordinary expansion' of trade and .industry in the country has taken place. In a report published by the British Department of Overseas Trade recently it, was pointed out that by 5923 Germany was practically without stock-i.i-trade, and that, her present working capital resources were borrowed, earned and otherwise accumulated eftcr that year, though each year a considerable proportion of these new resources had to lie transferred in paymen: of loan charges and reparations. The explanation of Germany’s ext.raordinarv industrial advance after 3923 is of course to be found in the fact that t: ?om -.hat year onwards she drew heavily on foreign capital to build factor ie

power-houses and railways and greatly extend public and municipal en'•'■■rprise: and out of the product of new and reorganised industry she was able *° maintain- exp< rts at a sufficiently high le-v'el to pay back to other nations ' small proportion of the capital borrowed from them. This is revealed in overseas trade figures. Including reparations deliveries, Germany’s excess of imports^over exports was .IIS? million Richsmarks in .1927 and 1996 million in 1928. But in 1929 imports were less than exports by 86 million Reichsmarks, and in 1930 the excess of exports was 1642 million Reichsmarks. A halt came in 1980, however, when the ! oan market began to close down. The development of German industry stopped short. In face of the world price slide and the disappearance of oversea long-term loan facilities, Germany turned to short-term borrowing, a step that only hastened the crisis of July last year; and in spite of the propping and patching which have been done sinee, Germany’s industry remains in a state which threatens her and her neighbours with a disastrous crash.