THE EXTENSION OF CREDITS

Nelson Evening Mail, Volume LXXIII, 9 December 1940, Page 6

THE EXTENSION OF CREDITS

I AMERICAN FINANCIAL AID TO BRITAIN SUBJECT GIVEN A THOROUGH AIRING NEW MOVES FORECAST ! [U.P.A.—By Electric Telegraph-Copyright] Received 9th Dec., 1.30 p.m. LONDON, Bth December. Lord Lothian’s statement succeeded in its primary aim of giving the subject of American financial aid a thorough airing on both sides of the Atlantic. Quarters in close touch with the Bank of England remain emphatic that an urgent need does not exist at present, but stress the desirability of timely preparations. Authoritative circles give credence to Washington reports that important moves for the extension of credits have begun. Some circles forecast early developments, partly because American readiness to grant financial support would greatly influence the attitude of several neutral Governments. One plausible theory currently advanced is that the difficulty created by the Johnson Act will be short-circuited by 'ending not to the United Kingdom but to gold-producing dominions. As Australian, Canada and South Africa have not war debts owing to the United States they are qualified to borrow and despite existing legislation could either lend money to the United Kingdom or repurchase their own loans issued in London. The “Financial News” says that the remit of the transaction on the balance would be a reduction in the dominions’ net indebtedness to the United Kingdom and a corresponding increase to the United States. Many bankers are of opinion that America will eventually lend direct to Britain without resort to subterfuge and might immediately be helpful by accepting delivery in South Africa, where it is estimated that £150.000.000 to £200.000.000 in gold is earmarked to the British account.