THE H.B. TRIBUNE TUESDAY, MARCH 20, 1934 QUOTAS AND MARKETS.

Hawke's Bay Tribune, Volume XXIV, Issue 83, 20 March 1934, Page 6

THE H.B. TRIBUNE TUESDAY, MARCH 20, 1934 QUOTAS AND MARKETS.

At last week’s dairymen’s conference the Prime Minister was able to announce that the British Government had decided to press no further, upon either Australia or ourselves, the proposal for a voluntary variation of the Ottawa agreements so as to admit of the imposition of a quota on the exports of butter to the Old Country. As a practical issue the subject may therefore be considered as at least shelved until the expiry of those agreements some eighteen months hence. Its discussion at last evening’s meeting of the Hastings Chamber of Commerce thus takes on a purely theoretic aspect. So far as concerns the basic principle involved there need be no doubt that the adoption of any artificial restriction of the kind is quite as repug nant to the British Government as it is to our own producers and was submitted only as a last resort under entirely abnormal conditions. Whether it was a sound suggestion, likely to achieve the purpose in view—the raising of prices on the British market for both Home and Dominion producers—will not now be put to the test. Each party to the controversy will thus still be able to stick to its own opinion and await the operation of the course of events that are admittedly difficult to forecast. As a supplement to last evening’s discussion, however, it may be suggested that the instance of the recovery in the wool market advanced by the president of the chamber can scarcely be taken as a parallel. In that case the whole textile-manufacturing world had been our market and we got the advantage of world-wide competition as soon as it began. Beyond this, although there had certainly been increases in world production, they were in no way comparable with the rapid expansion in the output of dairy products—in other parts of the world, too, besides our own. Nearly the whole of the extra volume of exportable supplies was being poured into the market upon which almost alone we had depended to absorb our own exportable surplus. Nor could Great Britain, seeking almost desperately to reestablish reciprocal foreign trade, afford to cut off altogether the foreign supplies that go to pay for her exports. This is an aspect of the ease of which our own exporters would seem to take but little cognisance, but it is one of supreme importance, for even they must recognise that the “purchasing capacity”—a phrase blessed even by our friend Bcrj nard Shaw —of British consumers will revive only with the revival of their foreign trade. The outside obstacles in the way of bringing about that revival are

patent to all those who have eyes wherewith to see. Nor is the instance of rubber in any way much more applicable, for that also was a matter of uncontrollable competition in the world’s markets, not in those of Great Britain alone. However, as has been said, the quota question is, for the time being at any rate, out of the count so far as the Old Country is concerned, and there is not very much to be gained by flogging a dead horse. Our dairymen’s hopes must now lie in the prospect of a general restoration of Great Britain’s oversea trade and, following Britain’s example, in their own efforts, supported by their Government, to find and cultivate new fields of consumption for their products. Both these sources of relief are obviously going to be somewhat slow of development, unless there is quite unexpected impulse given to the world-wide commercial recovery which is the ultimate aim of the British Government’s policy. In the meantime it may be as well to don considering caps as to the stand to be taken when the Ottawa agreements run out.