"INHERENTLY SOUND”

Nelson Evening Mail, Volume LXIV, 6 August 1931, Page 9

"INHERENTLY SOUND”

POSITION OF DOMINION

LONDON BANKERS’ TRIBUTE

FAITH IN COUNTRY'S FUTURE

“With reference to the present economic position of New Zealand, inherently it is sound and without question the Dominion will recover from her difficulties. Tho strength of the country lies in tho fact that her primary and secondary industries aro economically healthy and that the centre of gravity is stili with the rural interests. Tho gravest danger lies in that the workers might not real iso that. the. wages hill is ono of the chief items in cost, of production. . . . The prosperity oT New Zealand may rise or fall with I lie prosperity of the world, hut unless llie impossible happen and any one of the political parties put. self-interest beforo State interest, and thereby ruin their magnificent heritage, the Dominion should weather almost any storm, llcr record is clean, her credit good, and borrowed money has been spent on productive works.

“The soil is fertile and her people hard-working; they live in a fine land and have security of tenure; their cities aro well laid out and have not grown unwieldy at the expense of an expiring countryside. Well-built and efficient railways, excellent road transport, good harbours, cheap and abundant electric power, an educational system which might serve as a. model for many countries—surely these are sufficient reasons on which to base a belief that although for tho moment New Zealand is suffering from a world crisis, it is merely a matter of time for her to regain her full strength and buoyant activity." VALUE OF THE TRIBUTE This was published last month in London by Erlangers. Limited, a banking firm which is issuing a scries of monographs upon the manufacturing industries of the British Empire Overseas. The house did not set- out to pay New Zealand a compliment. Its purpose is lo supply information to British manufacturers and by extending knowledge to help toward tho solution of Great Britain’s economic problem. Tho oniy method of solving Britain’s unemployment problem, says the author, Mr Harold N. Carvalho, is to increase the output and sate of agricultural and manufactured products, order to increase home trade drastic rationalisation is suggested with or without protection, a subject outside tho scope of the articles. As to tho expansion of the export trado Empire free trado or Imperial preference involves complicated issues, but one point is perfectly plain: “We can ask our selfgoverning Dominions to take more of our manufactured goods only if by so doing they obtain some material advantage, or at- leasi sutler no loss.” On the study and solution of the tariff problem rests the future.of a closer economic union between Groat Britain, the Dominions and the Crown colonies, says tho writer, who does not discuss the merits of the various methods, but advisos British manufacturers to study tho needs of each market and produce goods ut- competitive prices.

NEW ZEALAND’S ADVANTAGES

In tho introductory article it is pointed out that New Zealand is lillipißian in comparison with Canada, Australia and South Africa. “Tho comparative smallness of New Zealand its legislative unity, its Jack of regionalism, the dismhntiou of its urban population into 188 towns of over 1000 inhabitants, tho absence of huge communities such as the six capital cities in Australia, which between them havo sucked into the vortex half tho sparso population of tho country, all these factors simplify its admin ; strativo existence and onablo it to face its difficulties and take full advantage of times of prosperity.” After presenting some statistics the author remarks: —“The manufacturing industries of Now Zealand aro the index of the growth and progress of tho country. Out of a manufacturing gross production of £93,172.222 or, including tho building industry, of £10*2,876,284, possibly 5 per cent, may be said to ho completely foreign to the trend of the country’s natural development and a further £7,900,000, or 8 per cent., might suffer severely if left unprotected lo tho blast of unfettered competition; in other respects, the manufacturing industries add to the wealth of tho Stato and of individuals without detracting in any way from the prosperity of primary producers.

i j SMALLER BURDEN ON PRIMARY INDUSTRY i I "In this respect they differ fundamentally from the many manufacturing industries of Canada and Australia, in both of which countries highly protected industries, and in many cases industries of a nature completely foreign to tho characteristics of the country, have been fostered for individual or regional benefit, but to tho detriment of pastoral, agricultural and other primary, production, on which rests tbo true wealth of tho Dominions.’' It had been estimated in Australia in 1929 that tho extra burden of cost on j tho export industry, added by reason of I tho tariff was between 7.7 and 9.9 per ] cent., a figuro which had since risen by j many points. In the case of New Zealand at least half of tho manufacturing ; industries wero tho mainstay of tho |

primary industries and although tho policy of rocont Governments had been to endoavour to stimulate new local industries by protective tariffs, in most instances the results had boon insignificant. j COMMON SENSE OF COUNTRY | “Thore are few agricultural countrios in the world which have shown such common sense,” remarks tho author, inado steady progress since 1880, but ‘The manufacturing industries have made steady progress since 1880, but they have grown by natural moans as a human being grows from infancy to adolescence. Tne war may have given New Zealand hotter prices for her produce and stimulated tne purchasing power of tho pcoplo, but it did not soduco her leaders into he oming protagonists ot freak industries.” The writer quotes the preferential tariff and declares that any criticism of the Government of New Zealand as aggressively or unoeonomically protection-i ist in policy seemed unfair. He is j deeply impressed with the measure ef . British preference which is “no lip sec- j vice, to Imperialistic dogma,” and says if in view of this truly Imperialistic treatment Great Britain cannot make headway then the British manufacturer has no ono to blame but himself.