ECONOMIC OUTLOOK.

New Zealand Herald, Volume LXIV, Issue 19699, 27 July 1927, Page 12

ECONOMIC OUTLOOK.

IMPROVEMENT IN POSITION.

INCREASING PRODUCTION.

POLICY OF GOVERNMENT^

[BY TELEGRAPH.—OWN CORRESPONDENT.] WELLINGTON. Tuesday. The Prime Minister, Mr. Coates, in an address at the conference of the New Zealand Farmers' Union to-day, dwelt upon the improved outlook so far as the general economic position is concerned. Especially, he said, was the future brighter as regards our primary products. Mr. Coates said that in the whole of the British Empire there was not a Government that had the representation from the farming community that the present Government of New Zealand had, and he asked the conference to consider that he himself was a farmer. He thought in the terms of a farmer. No one was more anxious than ho to arrive at a solution of the problems that faced the primary producers to-day, not only in New Zealand, but all over the world. It was true, that in New Zealand the position was probably unique in one respect, that by far the greatest portion of our. produce came from the primary producer. It was a world-wido depression or disturbance that affected the primary producers.

Improved Trade Balance, Mr. Coates said he was pleased to be able to say that for"the five months ending May 31 of this year our exports amounted roughly to £27,000,000, and for the same period last year the exports amounted to £25,500,000, an increase of £1,488,982. The imports for the five months ending May 31 amounted to £18,562,171, compared with £20,999,905 for the same period in 1926, a decrease of £2,437,734. So that in regard to the trade balance we were better off by £3,926,716 for the first five months of this year. He thought that showed the effect of economy, the tightening up of imports, and the increase in production. The latter was largely as a result of the efforts of the primary producer. "In my opinion we have turned the corner, and We are improving our position every day," continued the Prime Minister, "and the .outlook for the future is infinitely better than it has been for the last two years." There was, of course, the question of our markets to consider. Ho doubted whether anybody could follow a policy of free trade and substantiate it. Neither could they follow a policy of protection and substantiate it. Each item must bo considered on its merits. It seemed to him that it was a scientific tariff which they must consider. Greater Output Wanted. Referring to primary products in a general way, Mr. Coates said, the past year had been most satisfactory from-the point of view of output. "Our job is to see," said Mr. "how we can improve the farmer's capacity to increase production still further. If the primary producers of this country are able to make both ends meet reasonably the rest of the community will share in the prosperity." There had been satisfactory increase in the number of sheep, and there had been a record crop of wheat. The. figures and facts he had given showefl that the farmers had been increasing their products, and the sales showed a satisfactory increase in quan- ; tities. A matter which had recently been discussed was the borrowing of the country. It was true that something over £7,000.000 was due each year for the public debt, and of that over £5,600,000 was earned by the money wo had borrowed, that was to say, the users paid for it. Development of Country. Some people might speak of the public debt and say that...we had borrowed £5,000,000 or £6,000,000, and had to pay interest on it, whereas, as a matter of fact, perhaps £1,400,000 was expended on railways, electric power supply, and other public services, in addition to advances to settlers' liability, which later was no debt at all in reality, because it paid its own way. There had been some tomment in connection witlj the development of the country and the borrowing of money. The policy of endeavouring to 1 give the back-block settler access to markets had been clearly laid down. There was also the development side of the question to consider. In this respect, Mr. Coates mentioned as an example the East Coast railway and the North of Auckland railway. He also alluded to the expenditure on telephone communications, the cost of which was not borno by the general taxpayer. Ho dealt with the question of roads in opening up the country. In conclusion, the Prime Minister said we wanted to look to the future with confidence, and he thought we could look for much bettor prices and must do all that was possible to place ourselves in the position of being able to compete successfully with all countries with whom wo were in. competition.