FREE TRADE IN BUTTER.

New Zealand Herald, Volume LXIII, Issue 19235, 26 January 1926, Page 8

FREE TRADE IN BUTTER.

Having discovered that the New Zealand Dairy Produce Board has diverted butter shipments to the United States, the Westminster Gazette has made a number of deductions highly detrimental to the British Government's policy of developing trade within the Empire. The loyalty of this journal to the free-trade doctrines is so zealous that it obviously cannot condemn the board's action in accepting the highest available price : its object is to prove that so long as markets vary, efforts to guide the course of commerce will fail. Unfortunately, its attempt to use the Dairy Produce Board as a weapon against the British Government is defeated by the simple fact that the diversion it reports cannot possibly have been made by the board, which has no power to order the marketing of butter until after August 1. Any calculations of what the board is likely to do, based on what it has not done, are therefore merely idle speculations. On the other hand, the principal reason for the creation of the board is to organise the marketing of New Zealand produce in Britain, and though it would no doubt divert shipments to America if prices there were more favourable —to which free-traders could hardly object—the importance of the British market would always dominate its operations. So far as there is any relation between the two things, it should be fairly obvious that the risk of New Zealand butter being diverted to America is reduced by the efforts, official and otherwise, to stimulate the demand in the United Kingdom for British goods. Probably the first direct! benefits of this campaign will be felt by producers in the Dominions, but free-traders should not need reminding that their purchasing power will be correspondingly increased, leveling to a progressive expansion of British exports, which is the fundamental purpose of the British Government's grant of £1,000,000 a year for the fostering of trade in the Empire. Reduced to its simplest terms, the great, st problem confronting Britain is to widen the markets for her manufactures. On all modern experience, active measures are necessary to sell goods in competition, and it is only common sense to concentrate those efforts in the markets offering the advantage of a .strongly favourable sentiment. The opposition to this policy in Britain must be hard pressed when it has to invent commercial transactions to attack their practical value.