BALANCE OF TRADE

Otago Daily Times, Issue 23810, 17 May 1939, Page 3

BALANCE OF TRADE

DANGERS OF EXCHANGE CONTROL IMPORTANCE OF PRIMARY INDUSTRIES (Per United Press Association) AUCKLAND, May 16. Friendly criticism of what he described as "an obviously organised campaign in favour of New Zealand secondary industries" was made by Mr W. W. Mulholland at the Farmers' Union Conference to-day. The tendency, he said, was to infer that the primary industry was not as important as manufactures and that even if the overseas markets failed secondary industries would be able to provide all that was necessary to retain the present standard of living. Mr Mulholland said that not a manufacturer could turn a wheel or get raw materials unless the necessary goods were paid for by produce grown on New Zealand farms. If the standard of living was to be retained, it would be necessary to sustain the export values revealed in the last three years' records. Difficulties and dangers had been created, Mr Mulholland said, by exchange control, under which the New Zealand pound had two values. The farmers' difficulties were being increased by high costs and the widening of the gap between the internal and external value of currency would accentuate the position. Deterioration was now going on in the farming industry, and would increase as time passed. It would take Herculean methods to overcome this tendency. The effect of the Government's policy on the goodwill of overseas customers must also be considered.