BRITAIN AND THE EXCHANGE RATE

Manawatu Times, Volume 60, Issue 195, 20 August 1935, Page 7

BRITAIN AND THE EXCHANGE RATE

No Quid Pro Quo

VIEWS OF RETURNED MINISTER

(Special to “Times.”)

WELLINGTON, Last Night

An unqualified denial that an undertaking by New Zealand that there would bo a gradual reduction in the exchange rate had had any effect in bringing tho meat negotiations to a successful conclusion was given to-day by both tho Prime Minister (lit. lion. G. AY. Forbes) and the Minister of Finance (lit. Hon. J. G. Coates). Mr Forbes said that tho question of tho exchange rate had never been raised during the course of the negotiations. Practically every country had been forced to adopt some form of currency control, and admiration had been expressed in England of the manner in which New Zealand had faced its difficulties, and the action of the Government in getting the finances of New Zealand back to a stable condition. The people at Home recognised the difficulties of New Zealand, which, as a primary producing country, felt, possibly more than any other, the full effects qf the depression, and New Zealand had been given credit for the manner in which it had handled the situation. England to-day, in . its desire to assist tho agricultural industry, had departed a long way from its traditional policy of Free Trade, and had embarked on the road of subsidies and other forms of assistance. Mr Coates confirmed Mr Forbes’ statement that the exchange rate issue had not arisen during the meat negotiations. Naturally, there had been discussions with the British Government on the exchange rate, but he was not at liberty to indicate the nature of tlioso discussions. Mr Coates said that tho success of the conversion loan was a definite indication that New Zealand's credit stood high iu England. Many congratulatory references had been made by leading financiers and economists at Home regarding the success of the conversion negotiations, and it was of significance that the loan was oa a par with the ruling rate for British stock. New Zealand apparently had gone on the market at exactly the right time.

Mr Coates indicated that there would be further loan negotiations on the Homo market in tho near future.