JAPAN’S PROBLEMS

New Zealand Times, Volume L, Issue 11659, 25 October 1923, Page 3

JAPAN’S PROBLEMS

HUGE SUMS REQUIRED POLICY OF RETRENCHMENT DECIDED ON. FOREIGN LOANS NEEDED. By T^lejraph—Press Assn. —Copyright Australian and VTOKIO, October 22. Interviews with Japanese officials and European diplomatists indicate that the estimates of the losses in - the early days of the disaster were much exaggerated. The official estimate of the dead in ell the places affected is now nearly 200,000. Etsimates of the property losses are most difficult. The question is, should they be computed on the basis of original cost, or on that of present renewal. In either case reliable figures cannot be obtained, and the suggestions vary between 500 millions and 2000 millions sterling. DRASTIC ECONOMIES. Tn the destruction of most of Tokio, the disaster struck at the heart of Japan, Tokio being the financial centre of the nation. It is the financial burden, owing to the reconstruction work, that Japan must fear most. On the one hand the Government must expect a decrease of receipts, owing to its decision as an emergency measure, to reduce taxes, or forgo payment from the devastated district®, whilst on the other hand enormous-sums of money are required for the relief of sufferers and the restoration work. Th* Government has decided on a drastic policy of retrenchment, involving the total abandonment or postponement of schemes in hand, both current and for the next financial year. The Budget of £135.000.000 hae been reduced by £25.000,000. The great setback to tho finances of the country mmt react on the domestic developmental and foreign policies. CREDIT UNAFFECTED. How the huge sums required can be raised remain* to be seen. There is a national sentiment against extensive foreign loans, hut foreign borrowing is to some extent unavoidable. How little Japan’s credit haa been affected can be gauged from the fact that the exchange rate has scarcely fluctuated since the' earthquake; and the financial position is now comparatively stable. Naturally the banks are conservative in regard to loans; the bank rate is unchanged. Advantage is being taken of the present situation by the larger banks to squeeze out the smaller or force them to amalgamate. The position of people who lost bonds or stocks in the fire which followed the earthquake is most serious. In many case* the registers were also destroyed, and it wUJ take Years* to straighten out the. position, with total losses in many cases. NEW ZEALAND’S HELP CONTRIBUTION OF £25,000. ‘•MOST GENEROUS.” Australian and N.Z.. Cable A«oriaHon.

LONDON, October- 23. Sir James Allen, on behalf. of the New Zealand subscribers, has sent the fund of £25,000 to. the British Charge d|Affaires at. Kobe for the relief of the distressed. The Japanese Ambassador in. London has written to Sir James Allen asfollows: “I did not fail immediately to inform my Government of this most generous donation. I beg you to convey to your Government my sincereet gratitude to New Zealand for its magnanimous action in aid of the sufferers."