A MORATORIUM

Nelson Evening Mail, Volume LXVI, 9 June 1933, Page 5

A MORATORIUM

GERMAN FOREIGN DEBTS RESTRICTED SCOPE STANDSTILL AGREEMENTS NOT AFFECTED (United Press Association—By Electric Telegraph—Copyright) BERLIN, Bth June. It is widely reported that Germany is declaring a foreign debts moratorium on the Bth June. The transfer moratorium will be restricted in scope and will not include payments under standstill agreements, which Dr. Schacht will discuss hi London. Germany, regardless of the moratorium, intends to repay the United States £9,000,000, tlie balance of a loan during tlie banking crisis in 1931. The money has been earmarked since Dr. Schacht became president of the Reichsbank, and it therefore will not affect the Reichsbank's reserves.

“ONLY TEMPORARY” (Received 9th June. 12.5 p.m.) BERLIN, Bth June. The Government lias declared a general moratorium on all credits granted Germany prior to Ist July, 1931, because the banking crisis of that month caused Germany’s present financial position. Transfers will be made as far as possible on credits granted after that date. Existing standstill agreements at present are not affected, but Dr. Schacht hopes to obtain alleviation during the forthcoming negotiations at London. The Dawes and the Young Plan-are suspended. Private'debtors must continue payments into a special conversion fund which the Reichsbank promises to convert into foreign currencies whenever possible. Dr. Schacht in a letter to the Government emphasises that the moratorium is only temporary. Germany intends to meet her obligations in future. Tlie moratorium begins on Ist July. Dr. Schacht stated that the delay would enable modifications to be discussed with creditors in London on 13th June. Also the World Conference would be able to seek amelioration of the effects of the stoppage. He hoped the world would receive the news without anger and recognise that it was an international problem, remembering that Germany had to earn sufficient foreign currencies to enable her to pay her debts.