INDUSTRIAL CAPITAL.

Hawke's Bay Tribune, Volume XIII, Issue 77, 15 March 1923, Page 4

INDUSTRIAL CAPITAL.

One of ilus morning’s cables gives us | the substance of remarks made , by Sir Eric Geddes upon the necessity for providing fresh capital for industrial undertaking if Britain’s ever-increas-ing population is to be adequately maintained. It is pretty generally acknowledged among British economists that one of the essentials to revived prosperity is the rebuilding of the capital that can be made available for th© restoration and expansion of industrial enterprises. This process has been severely checked firstly by the heavy taxation that has been levied upon incomes, secondly by the attractive nature of the Government and municipal investments that have been offering, and thirdly by the uncertaity ot the markets for manufactured products. Attention is drawn by an Australian exchange to an interesting commentary on the change in the nature of British investments contained in a statement of the new capital issued in the United Kingdom over a series of years, including 1922, published in a recent number of the

“Statist.” For two of three years before the war it was reckoned that the amount of each year’s income in the United Kingdom converted into capital was in the neighbourhood of £300,000,000. This was not all shown in the publication of capital issues since those issues included only the issues of company stocks, local government stocks, and Government loans. The remainder was made up of income put into private firms and private buildings. Since the war the new capital issues have greatly' exceeded £300,000,000; but does not imply that material capital assets have increased to that extent. It is the result of inflation of the currency counters, and consequently of the currency having a lower purchagin gpower than its pre-war power. The following table, which is taken from the “Statist” figures, gives the new capital issues of the United Kingdom over 11 years. In it the amounts are expressed in thousands, the final three cyphers being omitted to meet exigencies of spacing.

What is noticeable here is the small proportion of the total in the later years put into trade compared with the proportion in the earlier years.’ Then trade absorbed the greater part of the new capital issued. Now Government .1 municipal borrowings take up the renter part.' This is not a healthy state of affairs, but it is d token of the uncertainty which suijrounds industrial development throughout the world. Of the 1922 total a sum of £79,158,000 went in new colonial investments, E 67,418,000 in new foreign investments and £438,375,000 in new British investments. .These figures also offer a strong contrast to the distribution of new capital in 1912 and 1913. In 1912 foreign investments took £95,635,000, colonial investments £64,407,000. and British investments £51,294,000. In 1913 foreign took £97,958,000, colonial £99,569,000, and British £50.709,000.

Government and Year. Trade. Total. £ £ £ 1912 . 47,519 163,818 211,387 1913 . 85,281 162,956 248,236 191-1 . 198,620 109,960 308,580 1915 . 916,936 18,408 934,344 1916 . 567,196 10,216 577,412 1917 . 1,304,127 11,856 1,315,983 1918 . 1,323,384 29,081 1,352,465 1919 . 845,349 183,468 1,027,816 1920 . 183,626 297,624 481,250 1921 . 300,137 92,663 392,800 1922 . 459,228 125,723 584,951