IMPORTS AND STERLING

New Zealand Herald, Volume LXXVI, Issue 23512, 24 November 1939, Page 6

IMPORTS AND STERLING

The theory of insulation, as applied by Mr. Nash to New Zealand's economy, has proved so faulty that it has resulted in the disastrous short-circuiting of the entire trading system of the Dominion. Business men have been forced into the position of endeavouring to find ways of repairing the damage and it is at least encouraging to know that the representative committee, set up as a result of the large deputation that waited on the Auckland Chamber of Commerce last month, is preparing a detailed "brief" in order that it may present a full and convincing case to the Government. Resolutions of protest carry very little weight,.but definite proof of all-round hardship may conceivably persuade Mr. Nash of the need for a more realistic approach to the problems of trade. The hopeless situation obtaining at present is revealed in the reply given by Mr. Nash yesterday to the deputation representing the commercial printing and associated industries that waited on him to ask for relief from restrictions imposed on the largest secondary industry in the Dominion. Mr. Nash was "impressed by the reasonable attitude" of the deputation, but added that ho was working very close to the limits of sterling funds and that he could make provision for future supplies only from any additional overseas funds which might become available. Under the export arrangements entered into with the British Government, embracing increased prices and virtually complete payment in sterling at the point of shipment, there should be an early and appreciable improvement in the position of our London funds. Even this week's Reserve Bank return shows an increase of more than £1,750,000 in sterling balances, with a healthy improvement in the ratio of reserves to demand liabilities. There is thus a strong presumptive case that, if only the Government were to cut down its own unessential imports, funds would be available for a gradual return to normal conditions in our overseas trade.