BANK NATIONALISATION

Otago Daily Times, Issue 26479, 5 June 1947, Page 7

BANK NATIONALISATION

SHARP DISPUTE IN HUNGARY REASON FOR M. NAGY’S RESIGNATION Special Correspondent. Rec. 8 p.m. LONDON, June 3. The financial editor of the New York Herald-Tribune European edition says the 'dramatic resignation of M. Nagy was due more to an internal economic controversy than to political factors. The cause of the present situation wa s the hotly-debated question of nationalisation of Hungary’s leading banks. In order to stabilise farreaching land reforms and industrial and transport reconstruction, the. four parties comprising the Hungarian Coalition worked out a three-year economic plan, but serious difficulties arose about the financing of the. scheme The Smallholders Party hoped to obtain the necessary finance from the West, but this was bitterly opposed by the Communists, who advocated nationalisation of the country’s major ( banks. The Smallholders, with M. Nagy as leader, took a stand on this issue which precipitated the present crisis. The big Hungarian banks have close financial ties with Western financial houses, and in addition control the majority of the country’s heavy industries. The Hungarian Economic Council precipitated the crisis when it decided,' during the absence of M. Nagy in Switzerland, to appoint controllers of 13 of the country’s leading banks. Receiving this news, M. Nagy apparently regarded it as the first step towards the threatened final control of the country’s, whole banking system. The alleged discovery of documents proving the Prime Minister’s ties with the January conspiracy appears to be only a supporting move in the contest between the Communists and the Smallholders on the nationalisation issue. The Hungarian Ministers in Washington, London, Berne, and Paris have been ordered to return to Budapest immediately. '. - * • The Smallholders sParty executive decided that all members of the party are to be “screened” by a committee, of five to eliminate any hampering of the , progress of collaboration within the framework of the Coalition. An Allied diplomatic source confirmed that the Speaker of the House, Bela Varga, who fled from Hungary yesterday, crossed the Russian zone of Austria and was in a “safe place.” TRIAL FOR UNITED NATIONS Rec. 8 p.m. WASHINGTON, June 3. In. a speech in the United States Senate to-day. Senator . Vandenberg, chairman of the Senate Foreign Relations Committee, described the Communist coup in Hungary as a “ treacherous conquest” and an overthrow of the elected Government which “ might become a clear call to trial in the forum of the United Nations.” It might becomd the. duty of the United States to sound that call. The Soviet • had never more cynically demonstrated its idea of democracy than in Hungary,, but he advocated ratification of the Hungarian Treaty because its rejection would not help Hungary. EXPELLED FROM MEMBERSHIP Rec. 8 p.m. LONDON, June 4. According to Budapest radio, the Smallholders Party political committee unanimously voted- to expel M. Nagy from membership.