EFFECT IN LONDON

New Zealand Herald, Volume LXXVI, Issue 23263, 4 February 1939, Page 17

EFFECT IN LONDON

FIRM'S HEAVY LOSS HALF STAFF DISCHARGED GOODWILL BEING LOST Import control in New Zealand is having much more far-reaching effects than most people would have imagined. A striking; example was given yesterday by a director of a London house which has been buying for firms in the Dominion for half 11 century. This informant, who has been on a business visit to New Zealand since the end oi: last year, produced a cablegram from his manager stating that owing to loss of business already caused by the restrictions he had had to discharge junior members of tho staff, amounting to about half its number. Many Firms Affected

"From what I know of my colleague, I am quite certain that he would not have taken this action unless it had been unavoidable," said the director. "Practically all our business is done with New Zealand, and wo liavo specialised for ma.ny years in meeting the needs of' established firms in this country. We jhave a few Australian connections, :it is true, but they are so small as to be almost negligible. This action by your Government is a very serious thing for us, because our business has been built up over a long period and we cannot switch to other countries at short notice.

"There are many other London firms in the sani;e position. I have noted the assurances by Mr. Nash that the final effect of the Government's policy will be to increase purchases from Britain, but that is i:n the future; I am concerned with the immediate effect, which in our case is what I have described." I'eellng in England In the past he had had many proofs of the goodwill and esteem which New Zealand enjoyed in the Old Country, the visitor added. He was sorry to say, however, that these feelings had faded very much. in. the past two years or so. The views lately expressed by the Federation of British Industries, he believed, truly expressed tho sentiments of United Kingdom manufacturers toward this country and its Government. "I have heard a great deal about hopes of establishing new industries in New Zealand," he concluded, "but as things are I c'an see 110 prospect • whatever of attracting British capital for investment in enterprises here."

POSSIBILITY OF LIFTING COMMENT BY MR. J. G. BARCLAY [from our own correspondent] WHANGAREI, Friday "When the hurdle, of the arrangement for the £17,000,000 loan that falls due this year is negotiated, then I think that the import restrictions will be removed by the Government and free import allowed," said Mr. J. G. Barclay, Government member for Marsden, vrheia speaking to a meeting of electors at Whangarei last evening. Mr. Barclay gave the Government's reasons for the placing of the restrictions on imports and the necessity of the building up of the sterling funds so that when the Government had to arrange for the loan that fell due at the end of the year the financial position of New Zealand would be in an unassailable position when the country went before the money-lenders. A further reason for the need of sterling funds by the Government, given by Mr. Barclay, was the large expenditure that had to be undertaken for defence purposes. The speaker traced the fall oi? sterling funds from the £40.000,000, when the Labour Government took office, to the present figure, and said that the first figure was abnormal, as the country had not been importing during the depression,_ and during the past few years this deficiency had to be made good. The present figure was about the normal amount of sterling. The other factors making for the fall in the funds were given by the speaker, who staid that the import restrictions would provide an impetus to local manufactures, and that any men who lost positions with importers would be readily absorbed in local industries.

At the conclusion of his address Mr. Barclay answered a number of questions put by members of the audience.