CONTROL OF MATERIAL

New Zealand Herald, Volume LXXII, Issue 22240, 15 October 1935, Page 9

CONTROL OF MATERIAL

EARLY EMBARGO LIK£LY LOANS TO BE PROHIBITED

By Telegraph—Press Association—Copyright (Received October 14. 6.25 p.m.) LONDON. Oct. 13 The Geneva correspondent of the Times says that the Financial Sub-Committee of the League adopted almost unchanged the financial sanctions produced by the drafting committee, which consisted of Britain, France and Rumania, based on the report of the committee established on April 16, which recommended that action against a Covenant-breaking State should include the prohibition of the opening of any credits abroad or the authorising of loans. The French delegates doubted the possibility of the sus- • pension of commercial credits, but when M. Maximos (Greece), the chairman of the Financial Sub-Committee, pointed out that United States exporters had decided not to allow further credits to Italy, the sub-committee realised that it could not refuse to take similar action. The sub-committee will present its report to the Committee of Eighteen at 10.30 a.m. on Monday. If it is accepted, proposal No. 2, as financial sanctions are called (the arms embargo being No. 1), will come into force immediately. The Geneva correspondent of the Daily Mail says that purely commercial credits in normal business have apparently been left for consideration by the Committee of Eighteen, as an attempt to place an embargo on commercial transactions would lead to confusion all over the world. Moreover, no steps will be taken regarding Italian deposits abroad, many of which are in neutral countries, or to prohibit Italy's sale of her holdings \ Gf foreign securities, M. Rueff, a French expert, having pointed out that such prohibition would dangerously affect the world money markets. The correspondent adds that a pleasant surprise to-day awaited those leading the struggle to show Ithat economic and financial sanctions can be an effective reply to warlike acts, when it was discovered that the export of certain key materials necessary for the prosecution of the war can be stopped at short notice. Accordingly, it is expected that if the Committee of Eighteen approves of the embargo it will become effective • on October 15 or 16.