ECONOMIC FRONT

Otago Daily Times, Issue 23946, 23 October 1939, Page 7

ECONOMIC FRONT

POSITION OF GERMANY TRADE WITH NEARBY NEUTRALS EXTRAVAGANT ESTIMATES (British Official Wirq)ess) RUGBY. Oct. 21. (Received Oct. 22, at 10 p.m.) The suggestion that Germany is organising a so-called blockade against Britain In which the co-operation of neutral countries will be enlisted as a result of economic negotiations proceeding in Berlin appears to be based on>. extravagant estimates of the pro•"•ductive capacity of the neighbouring neutral, countries to offset the effects of the British contraband control. A survey of the position appears in this week’s number of the Economist, whose objective accounts of economic trends in Germany are a regular feature. -The Economist says: “ Germany’s trade relations with neutral countries at present: may be summarised as follows:—Accessible neutrals are able to shpply a considerable part of Germany’s imports of foodstuffs. The most important raw materials they are able to supply are iron ore. bauxite, mineral oil, and timber. They cannot furnish all the bauxite and mineral oil the Reich will need by a considerable margin. and Russia’s exports, the value of which is being wildly exaggerated, cannot be appreciably expanded for some time to come. Moreover, these imports must be paid for by exports. “There has been no news from neutrals that Germany has not been able to execute orders, and so long as there are no major military operations Germany should be able to maintain her production of coal, iron, steel, machinery, and chemicals at, say, 50 per cent, of the level at 1938-39, but the 1938-39 level was much below 1937, and when a large-scale war begins it will quickly be made difficult to make export goods in large quantities.” • The Economist adds that considerable difficulties have already arisen in transporting goods from the Balkan countries to Germany. There is a shortage of rolling stock, especially in traffic "from Jugoslavia and Bulgaria to Germany. The cereal and oil transport of Rumania has had to be diverted to the Danube, and the Danube tonnage Is also scarce. CONSUMPTION REDUCED EFFECTS OF RATIONING - WASHINGTON. Oct. 21. Oct. 22. at 10 p.m). The United States commercial .attache in Berlin reports that food rationing ha s reduced the consumption of meat and butter by nearly one-half and other edible fats by one-fourth compared with peace time. Restrictions on textiles, clothing, and footwear have resulted in almost complete stagnation c/f retail sales.