N.Z. FINANCES

Hokitika Guardian, 21 November 1932, Page 8

N.Z. FINANCES

FAVOURABLE TRADE BALANCE

LONDON COMMENT

LONDON, October ,11'.

A leading article in the “Eihancial Times” is devoted to the economic position in Lew Zealand. “That New Zealand as well as Australia enjoys a firmly re-establish-ed reputation,” says the writer of the' article, “is sufficiently indicated by the price levels of its outstanding leans. The market and the investing public, alike are pretty shrewd appraisers- More important therefore than an advance of 30 per cent, or over in many New Zealand stock's from their lowest points is the extent to Which the gap which separates their level from that of British Government securities has been narrowed. It is impossible to draw an exact parallel, but to' take two four ,and a half per cents., New Zealand 1944 stands around 104, while British Conversion Loan 1940-44 is about 111.” The writer then explains the remedial measures adopted) to improve the position in the Dominion. “While the deficit persists,” the writer continues, “New Zealand admittedly is not conforming to'the strict canons of finance. At the same time, the decision to allow the country a respite frbm further taxation, in order t 6 encourage trade and hasten the recovery, of which theie are some few signs, must be read in conjunction with the fact that the Government is steadily bringing down its expenditure towards current income. It has been all too often demonstrated that taxation can become so oppressive as to diminish its own productivity. Revenue depends , ultimately upon trade prosperity, ahd from this point of view the improvement in the country’s overseas trade position is encouraging.''” , OTTAWA AGREEMENTS.

He goes on to explain that an actual expansion of exports is helping to establish a 1 favourable balance on a sound basis. ,

“This means more money, for the local producer and a fillip to trade generally. “That is a movement which should be hastened when the Ottawa agreeivpnts become operative. These are iu. tended prifnarily to foster trede within. the Empire, and New Zealand, with a generally unfavourable balance with other Dominions, <at present, looks to obtain real benefit. The p«sp.ct should he brightened H’ the trade agreement previously entered into with Can'.da which terminated