DOMINION CREDIT

Nelson Evening Mail, Volume LXXIII, 1 July 1939, Page 7

DOMINION CREDIT

LACK OF IMPROVEMENT POLICY NOT FAVOURED REVIEW BY ‘THE TIMES’ LONDON. 2nd June. Some difficulty in negotiation the conversion on favourable terms of the £17.000.000 loan expiring next January is forecast for Mr Walter Nash. New Zealand Minister of Finance, by “The Times.” In a leading article the results of import Restrictions and exchange control are reviewed objectively. and the reasons are stated for the lack of improvement of New Zealand's credit in the London financial market. Referring to the three main subjects with which Mr Nash’s visit is concerned, “The Times” says it sees little difficulty in arranging the details concerned with the defence of the Pacific. Trade and financial discussions, however. are regarded as falling in another category. “British manufacturers.” it is staled. "have not been satisfied by the assurances given by Mr Savage and Mr Nash tjrat there is no intention of reducing permanently the trade between the two countries. They believe that any attempt to control trade by the method adopted by New Zealand is bound to break down, though not before it has done a great deal of mischief. MUTUAL TRADE*EXPANSION SCHEME “The Times” continues: “When Mr Nash was in England two and a-half years ago. he brought with him a scheme for the expansion of mutual trade, to be based upon an undertaking by Britain gradually to increase her purchases of New Zealand produce in return for an undertaking by New Zea-

land to spend in Britain practically the ; whole proceeds of the sales. •This was so much at variance with our traditional ways of conducting overseas trade that Mr Nash could not persuade anyone in authority here to lake it seriously. "The control regulations when they' were issued excited much opposition, both in New Zealand and in this coun"ln Britain manufacturers asked how the new system could possibly be reconciled with the provisions of the Ottawa Agreement. which guaranteed them in New Zealand “full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production.” In goods of which the Dominion Government desire to foster the manufacture in New Zealand they arc apparently to have no opportunity to compete at all. and even of other goods the amount which they can export to New Zealand is to be limited at the discretion of the Government. OBJECTIONS TO ECONOMIC CONTROL | “It is not denied that New Zealand ;as a self-governing Dominion has the I right to adopt any economic system she prefers, but it is contended that | in making the change from a free to | a controlled economy she should have 1 shown greater regard to the interests 1 and the treaty rights of her best customer. ! Six months' experience of the working of the new system has not removed these objections Those who have suffered from the restrictions already in operation, and who are likely to suffer still more from the even more severe restrictions contemplated for the second half of this year, will not find it easy to accept the view that, in the long run. a controlled development is likely to lead to an expansion of mutual trade on a basis sounder and therefore more permanent than was possible before. The controversy has certainly not improved New Zealand's credit ‘in the London financial market where Mr Nash is likely to find some difficulty in negotiating the conversion on favourable terms of the £ 17.000.00( loan expiring next January.