TRADE REVIEW

Hokitika Guardian, 29 July 1929, Page 2

TRADE REVIEW

LOWER PRICES PREDICTED. USE OF UNDEVELOPED LANDS URGED. WELLINGTON, July 25. Speaking at the annual meeting ot the Wellington Investment, Trustee, and Agency Co., Ltd., to-day, Mr G. Sliirtcliffe, chairman of directors, made some comments on general trade conditions from the Dominion standpoint. “The two years ended June 30th last have been unusually prosperous ones, the excess of exports over imports being no less than £21,900,003,” sa.d .Mr Sliirtcliffe. “This satisfactory result has been achieved by an increased volume of production of the principal primary products of the Dominion coupled with high prices obtained on realisation. There are, however, the usual signs now that increased prosperity isjeading to the greater importaii n of luxury items, which, if continued, will tend to narrow the margin between the value of exports and imports. The maintenance of this margin must, therefore largely depend on a further increase in the volume of production and the continuance ot good- prices in the consuming markets There is every indication that the Dominion lutft by no means reached the peak of production and that the volume of its export trade will steadily increase. This is not only encouraging, hue essential ior the prosq bf the country, as the present outlook for a maintenance of world prices is more or less uncertain. Aly own view is that generally, speaking world production is rapidly overtaking world requirements and this will probably be reflected in a, gradual return to lower prices. It should not be forgotten also that the economic conditions of most consuming countries and the competition of synthetic substitutes are assisting this drift towards a lower price level. There may he temporary fluctuations in the prices obtainable for a particular corpmondity, but taking a broad view of world conditions I am afraid that the general drift of prices will be downwards.

“If this view lie correct it follows that increased production year by year, coupled with lower costs of production. is required, if a satisfactory balance of trade is to be maintained. Prosperity based upon volume of production must always he more stable than if caused by a wave of high prices, the backwash from which may be severely felt. The more rapidly therefore, the prqspnt undeveloped areas, of Crown and-others lands, particularly in the North Island, can he made productive, closer- settlement encouraged and assisted and modern scientific methods increasingly applied to farming operations, the more rapidly will the unemployed problem be solved- and the prosperity of the growing population, of the Dominion ' be based on a sure foundation. There are at present large areas of undeveloped Crown Lands, which from their nature can probably only be worked in large blocks in the initial stages of improvement, requiring the use of larger .amounts of capital than the ordinary individual has at his command. AC present capital owned by people who know from experience how best to develop such lands is deterred from being so employed by the heavy graduated land tax. It would, therefore seem good policy on the part of the Government if such areas could be defined and freed from the application of graduated tax for a period df, say, ten years, during which they could he developed to the productive stages and thus made available for subdivision into blocks suitable for the average small farmer. At present these lands are producing nothing either for He State or the individual. Surely, if the State itself is unable to bring them into a profit earning condition it would do well to give every possible encouragement to otjiers who may have the courage and the necessary capital to take up such areas and develop them. I am convinced that the ultimate benefit to the Dominion would greatly outweigh any - initial loss of revenue to the Government.”