Mr Nash's Awkward Dilemma

Manawatu Times, Volume 64, Issue 160, 10 July 1939, Page 7

Mr Nash's Awkward Dilemma

Fears of Default in Commercial Payments

LABOUR PROGRAMME GREATEST OBSTACLE United Press Association.—Bv Electric Telegraph.—Copyright. Received Sunday, 7.30 p.m. LONDON, July 8. It is understood that Mr. Nash’s abrupt decision to postpone his departure is due to a desire to await a reply from Mr. Savage as to whether the Government is satisfied with thc offer of arms credits and export credits facilities. It is held in London that the extension of such credit facilities would at least serve to avert a default in commercial payments which otherwise is regarded as inevitable in the next few months. The trade balance normally swings against the Dominion at this time of the year, consequently despite tho intensification of the Government restriction of exports, banking circles believe there is no possibility of the London funds lasting until the export season opens in January. Default in commercial payments would intensify the major problem of finding funds to redeem the £17,000,000 loan.

The greatest obstacle to the success of the recent negotiations, says the Financial News, has been the economic weakness resulting from Mr. Savage’s programme. Some modification, therefore, is regarded as essential if confidence in New Zealand credit is to b* restored. It is strongly rumoured that the redemption of the loan will be temporarily effected by reconrse to shortterm borrowing similar to the Australian effort some years ago. It would be costly, but the launching of a longterm loan would be virtually impossible.

Mr. Nash farewelled his wife, who is going to America aboard tho Aquitania from Southampton. He will follow' aboard the Queen Mary on Wednesday, rejoining Mrs. Nash at San Francisco after flying across America.