THE TARIFF TRUCE PLAN.

New Zealand Herald, Volume LXVII, Issue 20465, 17 January 1930, Page 10

THE TARIFF TRUCE PLAN.

Nearly three years have elapsed since the World Economic Conference, comprising experts from fifty countries, unanimously arrived at the conclusion that not only should the general increase in customs tariffs be stopped but also that a move should immediately be made in the opposite direction,. That conference declared that the customs barriers of European countries had been so greatly extended—seven thousand miles of new tariff walls have been raised since thfe conclusion of the war —and raised to such heights that they constituted a serious impediment to the return of Europe to prosperity. The practical response to the advice of that conference has been negligible and progress toward definite achievements by the economic activities of the League of Nations has been equally slow. In these circumstances, a cordial reception was given to the proposal of an international tariff truce when it was advanced by Mr. W. Graham, President of the British Board of Trade, at the meeting of the League Assembly last September. It has now. been announced that the Council of the League has fixed February 17 as the date for the holding of a conference to examine the proposal. As outlined by Mr. Graham, it involves an agreement by all nations to a "tariff holiday" of two years, during which no customs duties should be raised above the existing levels. The next step would be the summoning of a further conference to ascertain how the existing'tariffs could be reduced. Although the scheme is attributed to Mr. Graham, as its formal proponent before the League of Nations, credit for the conception of the idea has been given to Sir Clive Morrison-Bell, a member of the British House of Commons, who made the suggestion nearly three years ago in addressing a group of members of the Austrian Parliament in Vienna. In his opinion, it is too much to expect that countries will be suddenly persuaded to lower their tariffs—the steps must be gradual and a tariff holiday, while stopping a further rise in tariffs, seems to open the most practical road t'o more tangible results in the future. Even if the prospects of achieving a general reduction of customs duties are regarded sceptically, a tariff truce for even two years might produce beneficial effects by giving a respite from the uncertainties created by tariff changes, a factor that is almost as harmful to the growth of international trado as are the tariff obstacles themselves. But while the idea of a truce naturally appeals to Mr. Mac Donald and his colleagues, other Governments, especially those of. countries which rely chiefly on indirect taxation, may not be so ready to place such a restriction upon their Budgets, apart altogether from considerations of the protective use of customs duties.