THE New Zealand Herald. AND DAILY SOUTHERN CROSS. MONDAY, NOVEMBER 5, 1923. TRADE AND DEVELOPMENT.

New Zealand Herald, Volume LX, Issue 18548, 5 November 1923, Page 6

THE New Zealand Herald. AND DAILY SOUTHERN CROSS. MONDAY, NOVEMBER 5, 1923. TRADE AND DEVELOPMENT.

Constructive proposals for the extension of British trade, the alleviation of unemployment, and the development of the Empire are taking shape rapidly at the hands of the Imperial Conference. Before its sessions commenced it was sneeringly remarked— not in an official voice—that the visiting Prime Ministers were in search of preference for their products and of cheap money. However political partisanship may view the direction taken by the proposals produced, it cannot bo charged against them that j the possible benefits are one-sided. Whatever their faults, whatever their weaknesses, they are cej *ainly and I patently inspired with the spirit of | co-operation. The orthodox, in fact j the " die-hard," Free Trader has inj ferred that neither the Government , nor the Dominions representatives j had any plan save the introduction, | probably surreptitiously, of duties on | foodstuffs. A considerable body of i proposals has now been announced, with the specific declaration that whatever else be done, meat and wheat will not be taxed. The conception of Imperial preference has been broadened, so that the fiscal portion of it, while still important, jis not all-embracing. The new pro- | posals are at odds with the theory j that trade should follow its natural i channels. That figure of speech has | always suffered in application be- ! cause it is so difficult to define the ! natural channels. In any event the ' enthusiast for the doctrine of laisser ! fa ire should realise that streams fol- ! lowing their natural chau- els, often reach a dead end, as has British trade at present. Judicious diverj sion sets them flowing again to serve j the purposes of power, traffic and I irrigation. A ncheme to achieve j something of that result with Bri-I j tish trade is being propounded. The ! question for Britain seems to be j whether she prefers to see the waters | stagnate or to try setting them in | motion again by methods hitherto ; considered unorthodox. The economic proposals now being i propounded by Mr. Baldwin do not emphasise the development of the Dominions. Their purport is stated broadly to be the revival of British industry and commerce and the relief of unemployment. That is an aspect which, is very rightly made ; prominent in Britain. In the past most of ' the schemes have suffered j because their exposition showed that | the Dominions would benefit, and ; that the British taxpayer would ! bear the financial burden. These ! features made their advocacy diffi- ! cult. It was always believed by the | exponents of the policy that Britain ; would benefit ultimately, but the | supporting arguments were neces- ! sarily supposititious, if not tenuous, j If advocacy suffered in the past for j this reason, it would be even worse | prejudiced to-day when economic dej pression is severely felt, distress is • wide-spread, and millions are in no condition of mind or body to appreciate recondite arguments. The Dominions' representatives can be well content to have emphasised the , British side of the case. The plans > are all co-operative in nature, and j the benefits to the Dominion are ap- ! parent on their surface. The proposed protection ft manufactured j goods, with Imperial preference, j does not offer a great deal. The ! hint that there will be preferential i treatment for raw materials promises , better from the Dominions' stand- ! point, but, similarly with any sugi gestion of duties on foodstuffs, form ! a section of the subject on which ! advocacy must be limited, because ! Britain must plan her own household 1 economics. When Mr. Baldwin contends that the Empire should be ini dependent of outside sources for raw ! cotton, sugar and tobacco, he enters | a phase of development where all | the Empire can join hands in enthuj siastic advocacy. The Empire may j never become entirely self-contained, i but that is no reason why intelligent : effort should not be devoted to maki ing it as nearly so as possible. The j process seems to be equally of coni servation and development, conserI vation of British industry and com- ! merce by the development of Empire i resources and, consequentially, mar- ! kets.

The stimulus to development, with the utilisation of British material, though . assistance in finding loan capital for approved works in the Dominions is a proposition which should arouse wide interest. It is sketchily presented in the cable messages, but it appears to mean that Britain will give a rebate of three-fourths of the interest for five years in order to secure that contracts for supply will be placed with British firms. It is, in effect, a kind of bounty for the British manufacturer. It places him in a preferred position against competitors from foreign countries. At the same time its application, to purposes certified as anticipatory of normal expenditure, promises an acceleration of capital expenditure on developmental work in the Dominions. As a result, migration should be stimulated, and a permanent enlargement of markets secured. By the Trade Facilities Act of 1921 and 1922, the British Government undertook to guarantee approved loans for State or private enterprise at home and abroad with the idea of stimulating trade. It was not an Empire scheme ; it was of little use to the Governments of the Dominions, Their own credit is sound enough to make them independent of any such guarantee. Up to the end of last year loans aggregating £22.243,000 had been approved for guarantee, but this does not seem to have produced any substantia,! result on British depression. What the latest proposal might mean to New Zealand can be appreciated I if it is considered in relation to the I Arapuni scheme. If three-fourths of I the cost of material were to be free 1 of interest for five years, the increase ?v 8t caused by finding inI terest for the period of construction

would be reduced so much as' to be almost negligible. Thus one of the most difficult phases of construction finance would be eliminated. The scheme is still only tentative. Discussion of details may reveal unsuspected difficulties. At its present stage it exemplifies in particular the combined effort being made to discover new methods of practical, efficient co-operation to increase the economic well-being of all parts of the Empire.