GERMANY AND SUPPLIES FROM RUSSIA

Nelson Evening Mail, Volume LXXIII, 10 January 1940, Page 4

GERMANY AND SUPPLIES FROM RUSSIA

IT is reported that though the Germans are saying that trade negotiations with Russia are proceeding satisfactorily, the head of the Delegation, Dr. Ritter, has returned to Berlin for fresh instructions and has had long conversations with Herr von Ribbentrop. Two of :the problems to be solved, we are 'informed, are how the goods are ito be transported, and how German industry, which is already strained to the utmost, can fill the Russian orders. Mr C. W. Gullebaud, a Cambridge economist and author of a striking book “The Economic Recovery of Germany,” examines Germany’s position under the economic blockade in an informative article in “The Fortnightly.’’ In reviewing Germany’s foreign trade problem as a whole, he expresses the opinion that it would seem to turn on two I main factors, transport and finance. Germany is cut off by the British Navy from all her overseas sources of direct supply other than from the Baltic countries, and she must re-orientate her supplies to travel overland instead of the very much cheaper and easier method of sea-borne trade. He points out that in 1937 not more than one-fifth of the total imports (measured in value) came to her from the countries to the east and south of her boundaries, while of the remainder by far the greater part was carried in ships before reaching a railhead on the European continent. The swing over to land transport, even if the goods are available and can be bought, is a stupendous problem. The authority quoted is also of the opinion that the value of the Russian alliance in the economic field is highly problematical, for the reason that the Russia of to-day produces many of the things which Germany can export and that the kind of goods which Germany exported to South America and other countries are not likely to be what Russia will require; further, Russia is likeIv to want many products which Germany will need for her own war efforts, and again, Russia is far away, the communications in Poland have been badly damaged by the war and were at no time based on large-scale east-west traffic. Even if Russia is willing to supply raw material on credit it will be very difficult, it may, he says, well prove impossible, to transport them in large quantities to Germany. Moreover, in recent years Russia has not appeared in the world markets as an exporter of large quantities of food or raw materials, and there is no reason to suppose that she either could, or would, transport supplies, sufficient to make a big difference to Germanv, to the north-western frontiers of her vast country.

Germany has neither gold reserves nor appreciable holdings of foreign securities with which to pay for her imports. She must either export goods or obtain what she requires by means of credits.