German Post-war Trade Economy

Northern Advocate, 30 March 1946, Page 5

German Post-war Trade Economy

'Rec. 2 p.m.) LONDON. Mar. 28 The plan for Germany's post-war economy worked out by the four occupying Powers'was published today. It permits Germany to reach a living standard 30 per cent below pre-wqr by 1949. says Reuter's Berlin correspondent.

This standard, it is estimated, equals an average for Europe, excluding Britain and Russia. Germany's economic capacity to wage war is almost totally destroyed under the plan, which restricts exports and imports. Exports are planned for a value of £250.900.00(1 and sufficient industrial capacity is being left Germany to produce goods to this value and cover Germany's internal requirements. Imports also are fixed at £250,000.000.

The guiding principles of the plan are: Firstly, the elimination of war, potential and industrial disarmament; secondly, reparations to countries which suffered German aggression; thirdly, developne'nt of agricultural and peaceful industries; fourthly, retention of production capacity sufficient to enable GorAany to support herself without assistance. FOUR CATEGORIES Most of the plan's 1-t pages consist of figures giving the amounts of various commodities Germany will be allowed to produce when she reaches normal in 1949.

The plan lays down that, after production to capacity of various branches of industry, approved lists of enterprises available for reparations will; be dompiled economically. A directorate will then formulate the final plan embodying detailed decisions on disarmament, reparations, post-war economy and balance of trade.

A British military Government officer. commenting on the plan, said German industry was divined into four categories: Firstly, industries prohibited because of importance to war potentials. Some of these will be retained temporarily to meet domestic requirements until imports are available and can be paid for. CUT IN CAPACITY Secondly, industries in which there was no restriction as they have no important war potential/ These are expected to provide a proportion of exports with which to pay for imports. Thirdly, industries in which levels fixed to capacity in excess of these levels may be removed by reparations. These include steel, heavy and light engineering. and electrical and chomincal industries. compared with prewar levels. Steel production will be reduced by 67 per cent, chemicals by 55 per cent, mechanical engineering by 66 per cent, and electrical engineering by 50 per cent. The cuts are the heaviest on those sections of industry devoted mainly to war. Thus the machine tool industry will be cut to a level not exceeding 11.4 per cent ol prewar capacity.

Fourthly, certain industries, the level of which is not fixed lor 1949. but from which it is at present not intended to exact reparations, for example, coal. HARD TASK The British military official said it was estimated that after the removal of reparations sufficient plant would remain to permit recovery by 1949 from the present emergency levels to approximately 1932 standard of living. Germany was permitted production of steel at present fixed at 5,800,000 tens annually. It was agreed that a capacity of 7.500.000 tons annually would be left to Germany. British experts agreed that this quantity would be needed.

The British spokesman said Germany was not at present being treated as an economic whole. This is understood to be a temporary phase. If the Saar were detached from Germany there would be a clear necessity for revision of the plan.

It would not be easy for Germany to recover under tiic plan. The Germans were being set a very hard task, but "one should not forget the Germans possess an amazing power of recovery."