TRADE AGAINST US.

Manawatu Standard, Volume XLVI, Issue 110, 9 April 1926, Page 6

TRADE AGAINST US.

For the twelve months ended on February 27tli the trade figures are, for the first time since 192 U, against us, the imports having exceeded the exports during that period by some three millions or so. To a certain extent that may be accounted for by the shipping hold up of last year, which prevented our produce going forward to the British markets; but it is duo also to the lower values that produce is commanding overseas. As we have an interest bill of approximately five millions per anuum to meet in London we are likely, therefore, to have to make, good some eight millions or so in that city within the next few weeks. It is unfortunate that buying has gone on so extensively in America and Canada; but when, as was the case a month or two ago, a vessel arrives in Auckland from overseas with a consignment of motor cars approximately •/-alued at one million sterling, the question naturally arises: “Are not our traders buying abroad too largely and m doing so exceeding the safe bounds of business?” It cannot be too strongly insisted upon that the, surplus wealth perhaps we should say the overseas trade money--of our Dominion is almost wholly, if not solely, derived from our exports, 95 per cent, of which consist of the primary products of the soil. If then we exceed, with our purchases abroad, the value of the produce we send overseas, and fail also to make any provision for the interest payments falling due abroad, we are working upon very dangerous lines, and lines that must appreciably affect our credit in London and elsewhere, and that might easily spell disaster in our loan arrangements. We do .not know how far the banks are supporting the importers in their trading operations, but the December quarter of 1925 shows an appreciable increase in the advances compared with the September quarter, amounting in round figures to £3,600,000. But the banks were helping the exporters in their difficulties during the shipping crisis, and a portion, at least, of the increase must be credited to that account. It is possible that the figures for the financial year ended on March 31st may disclose an even balance between exports and imports, but, even so, a good deal of leeway will still have to be made up before the trade position can be regarded as satisfactory. Economy should be the watchword in both trading and Government circles, if we are to pass through .1926 unscathed. Both public and private expenditures should be conducted on that basis if we desire to avert the depression which is otherwise inevitable. Both the State and the private individual will be well advised to live strictly within their incomes.