EXCHANGE AND TRADE

Otago Daily Times, Issue 17936, 15 May 1920, Page 10

EXCHANGE AND TRADE

UNITED STATES AND NEW ZEA- I LAND. , (Fboii Oub Own Correspondent.) AUCKLAM), May 14. When a state of virtual crisis was reached last January in the import trade owing to the figures quoted for exchange on America, the; opinion was freely expressed that the ultitaate result .-would be' the swing of the pendulum, in favour of the British manufacturer and exporter as far as supplying Now Zealand's requirements was concerned. Though the exchange rate has recovered 'to a certain extent it remains sufficiently low to exercise a considerable influence upon the prices of imports from the United States. An Auckland business man, who deals in a number of imported lines, particularly hardware, stated in mi interview that a considerable diversion ctf orders to British firms; had taken plaoo in such volume that the manufacturers were entirely unable to cope with them. It was not possible, Consequently, that the _ opportunity for British trade to regain its grip could be seized as fully as would otherwise have been the case. The movement, nevertheless, had made itself felt to the extent of inducing numbers of exporters in the United States ts>. quote special discounts for the export mile in order to meet the exchange problem. For these reasons, he continued, it- was to be regretted that the British houses were faced with a much greater volume of orders thiui they could possibly deal with. The extent to which trade had already been diverted hod undoubtedly hod some! influence in the subsequent rise in,,-the.exchange. Had the British firms been able to fulfil more orders tho results ■would doubtless have been of advantage both to British and Now Zealand trade. For some* time after the war, however, niany British manufacturing houses were turning, out less than 40 per cent, of their proper output, and in some cases actually less > than they had produced during the war. Labour troubles, coal shortage, and all the. disturbing factors incidental to tho early afterwar period hod contributed to this result, consequently they wore left With a heavy legacy of bade orders to fulfil. They took new ones so far as they could, but beyond a certain point there was not much ohance of delivery. Not Only had this amount of lost ground to be made up, but there was also the matter of Dew demands upon tho resources of tho manufacture consequent upon the' need of all sorts of material on tho Continent, and also tho great demand on tho British market itself. There was one occasion, continued tho importer, when he was complaining to a British firm of the delay in the fulfilment of his orders that the reply he had received was that had _ not the firm in question decided to set aside a certain amount of its output far the export trade, . he would have received nothing at all. Had he so desired, said the manufacturer, he could have sat in _ his own office and jold all that his business oould produce without sending oat a single traveller. The desire to keep up his connections abroad bad induced him to allot a fterrtain amount of liis output for tho export trade, and this was the only reason why the New Zealand buyer was able to obtain any goods at all. Shipping, said the importer, had improved and was continuing to improve. Other things being equal, ho continued, his experience showed him that an undoubted preference existed in Nerw Zealand for British goods as against the American, as the price undoubtedly, was a factor in governing the demand. Not onlv did tho general publio prefer the Britisn article, but bought it evon when it was a little dearer. '