PALTRY MILLION TO AIL TRADE

Manawatu Times, Volume XLIX, Issue 3263, 5 February 1926, Page 10

PALTRY MILLION TO AIL TRADE

LACK OF ENERGY THAT IS DISTURBING. LONDON, Jan. 20. Mr. Ben- Morgan, chairman of the Empire Producers’ Organisation, stated in an interview that th e British Government’s lack of energy in Empire development * was profoundly disturbing to his organisation. The latter deplored the flotation and oversubscription of numerous large loans, mainly for foreign industries, while the Government’s effort to develop the dominions was limited to a paltry £1,000,000 for assistance to Empire marketing. ' “This is a stupid policy,” he said, “because if £100,000,00 were allocated for Empire development it would do more than anything else to relieve unemployment. . The Government, on the contrary, permits foreigners to secure loans for strengthening their own industries, which arc actively competing ‘with Empire mdustries. "The foreign loans almost represent a scandal, because they are issued at a large discount, with exorbitant interest, by cosmopolitan financial houses in London, whoso only concern is to !obtain a large underwriting 1 commissions, sometimes reaching 8 per cent. “The majority of these loans are without security, yet the Government does not interfere, while investors run the risk of being hoodwinked. Investors naturally fight shy of securities going at a discount, but they do not lealiac that many dominion loans go at a discount because the excessive rates of foreign loans give a false scale of values to the stock market.”

Mr. Morgan said British credit belonged to :h e Empire, and therefore should be shared in common. ‘lf the British Cabinet fails to take action,” he said, “the dominion statesmen at the coming Imperial Conference should insist on some definite partnership scheme :n the management of the Empire’s purse.

“If the British Treasury insists on London remaining an open market the Government ought to impose a tax of 25 per cent, on foreign loans and renewals. This would not deter them, because the underwriters’ profits Would easily cover the tax. It would result in a substantial revenue, making possible the reduction of taxation or the provision of larger sums for Empire development.”