AUSTRALIAN TRADE

New Zealand Herald, Volume LXX, Issue 21577, 23 August 1933, Page 5

AUSTRALIAN TRADE

DECREASE IN BALANCE / SOUNDNESS OF POSITION INCREASE IN IMPORTS [from our own correspondent] SYDNEY, Aug. 16 - Although the overseas trade figures .for'the 12 months ended Juno 30 Inst show a decrease in the favourable commodity balance from £30,795,000 —in 1931-32 —to £21,216,000, the Federal Government has been advised that the overseas trade position is sound and that all overseas commitments can bo mot without difficulty. Tho decrease in the favourable trade balance is due to the increase of 29 per cent in imports, while exports during tho year increased in value by 4 per cent. Tho actual commodity figures in sterling "were as follows: — 1932-3:! ' 1931-32 Exports . . . . £78,03(1,000 £74,838,000 Imports . . . . £5G,820,000 £44,013,000 Favourable* trade balance . . £21,2)0,000 £30,795,000 In -Australian currency Australia's commodity exports for the year ended June 30 last were £97,770,000, compared with the £95,272,000 during the 12 months ended Juno 30, 1932. Imports for tho fiscal year just ended were £71,167,000 in Australian currency, compared with £56,115,000. Tho trado balance in Australian currency value for the year ended Juno 30 last was thus £26,623,000. The effect of theso figures will bo that tho overseas position will bo just about square after making allowance for all payments, including Government, municipal and private interests, imports and all invisible services. General Effect of Figures ' Official figures, which will enable an absolutely accurato statement of tho • position to be drawn up, will not bo ready for some weeks, but tho general effect of the commodity import and export figures, which are final, can bo visualised in the following way:—Experience has shown that if the exports of merchandise and silver could bo added to exports of current gold production tho result gives the total sum available for meeting overseas commitments. Tho official overseas trade position can bo arrived at by deducting from this total the value of the imports, plus payments of Government and municipal interest. Tho balance thus reached is approximately tho samo as tho total balance if all these payments Australia is to mako overseas, including private interest and cost of invisible services, were taken into account. , ... ~, e Actually, tho application of the formula shows that Australia is lia.li a million to the bad on the year s trade figures, but, counting all sources, there is probably £40,000,000 of accumulated Australian credits in London to offset this nominal debt. Bank Credits in London The latest Commonwealth Bank returns show a total of about £12,000,000 accumulated in London by tho trading department of the bank, apart f ro ' n credits held by other Australian trading banks, the actual figures for whicn aro never disclosed. In addition, Australia "has exported to London £11,260,000 in gold, representing the reserve against the note issuo. lnis has lieen converted into sterling securities and cannot be taken into account in discussing the trade position, because it is not available for ordinary trading purposes. . _ In addition to the foregoing there is £1,000,000 in gold exported during tho vear which apparently has not como from current production. This item may be described as a depression phenomenon. It represents £1,000,000 of gold exported above current S o '" production and is believed to have been derived mainly from the sal 6 of private jewellery, although tliero is no way of ascertaining its exact source. Tho result, nevertheless, is to strengthen Australia's position abroad.