BRITAIN'S EXTERNAL TRADE

New Zealand Herald, Volume LXXIII, Issue 22447, 17 June 1936, Page 12

BRITAIN'S EXTERNAL TRADE

With the Board of Trade figures for May available, the course of Britain's overseas trade for the first five months of the calendar is revealed. Exports have made a modest increase jja- value, some £2,275,000, compared with the total for the corresponding period in 1935. For imports, on the other hand, the rise has been much more substantial, amounting to a little more than £33,500,000 for the five months. On this basis a higher adverse commodity balance for the whole year is indicated. Such a movement need not be regarded with alarm. In 1935, according to Board of Trade figures, the debit balance on merchandise account was £261,000,000. With the addition of the usual invisible items —-shipping earnings, income from investments and other payments —a credit balance of some £37,000,000 was estimated. In 1928, before the onset of depression, the adverse commodity balance was £352,000,000, but other items transformed this into an estimated credit balance of £123,000,000. The debit on merchandise account can go much further than that of 1935 without calling for corrective measures, provided other factors are satisfactory. The greater activity in trade shown at present, as well as a quickening in the pace of industry which has been noted earlier in the year, has been attributed largely to one cause, the expansionist policy of the Government, especially in armaments. The decision to rearm has been taken because of the Government's view of world conditions. It was not intended as a stimulus to industry, though it could not fail to have that effect. It is bound to affect heavy industries in particular—coalmining, engineering and shipbuilding. Some of its early consequences can also be seen in the rise in imports, attributable to increased purchases of raw materials destined to be used in the manufacture of arms.