TRADE WITH AMERICA

New Zealand Herald, Volume LXXIII, Issue 22389, 8 April 1936, Page 16

TRADE WITH AMERICA

AUSTRALIA AND DOMINION

REDUCING ADVERSE BALANCE LITTLE HEADWAY LIKELY The efforts being made by Australia. to balance its trade with the United States draws attention to the position of trade between New Zealand and the United States. Unless there is a radical change in the fiscal policy of the United States, it is very doubtful whether either of the Dominions can hope to maintain an even twoway trade. Failing America agreeing to take more primary products, the only alternative is for the Dominions to impose heavier tariffs on United States goods, thus diverting trade to great Britain or Canada.

For years the balance of trade between New Zealand and the United States lias been in favour of the Jastnamed country. In 1930 the Dominion had an adverse balance of £5,598,000. Heavy cut 3 in imports reduced this balance to £1,594,000 in 1933. However, importing increased in the two following years and exports to the United States also advanced in 1935. The adverse balance was £2.297,000 in 1934 and £1,894,000 in 1935. A comparison of trade figures for the first two months of the past three years is as follows: —

Exports Imports Balance £ £ £ 1934 .. 133,988 454.266 - 320,278 1935 . . 305,785 694,697 - 388,912 1936 . . 481 796 859,679 -377,883

The total trade between the two countries has increased from £588,254 in January - February, 1934, to £1,341,475. Exports are over three times higher, while imports have almost doubled, but the greatest actual increase has been in imports, which accounts for the increase in the adverse balance. The increase in imports may Ixj attributed to the improved internal conditions in New Zealand and this trend is lively to continue as recovery progresses. A continuance of larger exports to the United States cannot be regarded, with certainty. Over the past two years the United States has been a larger buyer in commodities, such as wool, butter, hides and tallow, which in normal years she has been accustomed to produce within her own borders. The United States claims that its programme "is to promote a widespread multilateral enlargement of trade which ultimately will benefit the whole world and particularly the exporting nations." Admittedly, bilateral agreements have the disadvantage of " putting trade in leading strings " but this method seems the only one possible under present conditions.