AMERICAN EXPORT CREDITS

New Zealand Herald, Volume LXXVI, Issue 23382, 26 June 1939, Page 10

AMERICAN EXPORT CREDITS

As an adjunct to the President's new loans programme for the support of industry and employment, the United States proposes to establish a scheme obviously similar to the British export credits system. The identity was proved when the proposal was attacked in the Senate and an official reply stated that it was a matter of financing exports rather than of lending money, the President having stipulated that the proceeds of the advances must be spent in the United States. It is expected that the credits will be extended chiefly to the South American republics. The general term probably means Brazil and Argentina in particular, for these are the two which have specially concerned the United States Government of late. At the beginning of the year an economic mission from Brazil visited Washington. Little was made public about the discussions, but the basis of them was generally understood to be American anxiety over the increasing German penetration through barter agreements, and a desire on Brazil's part to obtain credits for the purchase of capital goods, required for the programme of industrialisation and defence. Figures show that in 1936 Germany forged ahead of the United States in the supply of goods to Brazil, and could be expected to maintain or improve her place in default of effective challenge. With Argentina the position is not quite the same. In February it was announced by the Argentine Exchange Council that imports from the United States were to be curtailed in order to reduce the adverse balance of payments with that country. Argentina had been feeling the pressure of European customers to buy their manufactured goods, and was thus responding. Circumstances such as these can be accepted as the main cause of the new move.