DEBTS AND REPARATIONS.

New Zealand Herald, Volume LXVIII, Issue 21068, 30 December 1931, Page 9

DEBTS AND REPARATIONS.

GENERAL MORATORIUM. FRANCO-BRITISH PLAN. APPEAL TO UNITED STATES. By Telegraph-—Press Association —Copyright. LONDON. Dec. 28. Tim special correspondent of the Sun says lie understands that Britain and France are Hearing an agreement on a reparations policy in readiness for the international conference to enable the granting to Germany of a general moratorium to bo followed immediately by America's European debtors seeking a similar moratorium from America. The conference probably will be held at Geneva or Lausanne on January 20. The unyielding attitude of the United Stales has led Britain and Franco to overcome their three main differences. France forgoes her insistence upon priority in the matter of Germany's commercial debts in the event of a further general moratorium. , France further insisted that the principle of the Young Plan should remain intact, which point Britain concedes. Britain wanted the forthcoming conferonce to negotiate a permanent arrange- j merit, but now is prepared U agree to a | provisional adjustment. The hasty convening of the conference probably will preclude the direct representation of the Dominions, says the •correspondent., bul in the. event of :i general moratorium they will not be, affected. It will bo virtually a reopening of the Hoover Plan. Britain in that case would also relieve the Dominions of their Governments debts to Britain. The next move would bo for the European States to request the United States to concede a general moratorium to them. BASLE EXPERTS. COMMENT ON REPORT. GERMANY'S ECONOMIC POSITION. British Wireless. RUGBY, Dec. 28 Tn commenting on the Basle report the Times says its very limitations only make it. plainer than ever that an opportunity is offered to statesmen to find by co operative efforts some way out from the economic impasse. The experts' careful statement leaves no room for doubting that the economic gravity of the present crisis exceeds in magnitude the relatively short depression envisaged in the Young Plan, to meet which provision was made for a two years' moratorium on Germany's conditional and even on her unconditional payments. After examining the situation created during the past year by the withdrawal of foreign funds and the fact that shortterm credits are only being sustained under the *' standstill ' agreement which is due to expire in February, the limes . says:— j " Unless Germany's reparation liabil- j ities arc fixed at a figure which will en- j able foreigners to lend with full confidence in her future, not only will she | he unable to pay reparations, but she will be forced to reduce her economic activity to a very low level to the manifest. detriment of the rest of the world. "A mere moratorium leaving Germany's ultimate liabilities untouched would simply lead to a still more dangerous crisis. That is why the British Government insisted strongly in its recent Noto upon a permanent solution." World's Financial Paralysis. Tho Daily Telegraph says: "Without stability the world cannot recapture prosperity and as the first condition of stability a permanent financial settlement among the nations is essential. We mav be justified in saying that the diieutors of Germany's economic policy have set themselves out to create conditions in which the payment of the obligations imposed upon her by her defeat in the war would be impossible, but that does not give us the means of exacting money. " The duty of the Governments in conference is to devise a scheme which will harmonise international debts with present conditions." The News Chronicle savs: " Until the whole question of Geimany's financial situation is satisfactorily dealt with, ordinary movements of capital between one country and another will not be resumed, trade will come to a standstill and the financial paralysis from which the world is suffering will continue and intensify." No Invitation to M. Laval. The date and venue of the international conference of the Governments concerned with the reparations problem have still to be fixed. In the meanwhile discussions of tho technical issues that arise are proceeding between French and British experts. A j report gained currency in Paris that an early meeting between the heads of the British and French Governments was in prospect, but the French Prime Minister, M. Laval, to-day denied that he had been invited to confer with Mr. MaeDonald in London. He said it was not at present contemplated to hold any such meeting, which would only be opportune after tho experts have completed the task on which they arc now engaged. STARTLING SUGGESTION I I ! FRENCH AND BRITISH DEBTS. ! ISLANDS INSTEAD OF CASH. NEW YORK, Dec. 28. Mr. Louis T. McFaddcn (Republican— Pennsylvania), a fiery critic who has frequently attacked the President, Mr. Hoover, says he thinks it would be a fine idea if France and Britain gave their colonial possessions adjacent to the coast line of America in lieu of paying their war debts. The islands of St. Pierre and Miquelou, off Newfoundland, and the Martinique Group, West Indies, Mr. McFaddcn says, he would take from France, and Honduras and British Guiana from Britain. PRUSSIA'S DEFICIT. BF.ItLIN". Dee. 28. Prussia's attempt to cover a Budget deficit of 167.000.000 marks does not spare even the German fetish for chemical research, eight, institutes for which are to be closed. In addition 12 teachers' training schools, 60 courts of justice, three State theatres and three art academies are to be closed and many professorships arc to be cancelled.