Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, SATURDAY, DEC. 31, 1938. THE YEAR IN RETROSPECT

Poverty Bay Herald, Volume LXV, Issue 19826, 31 December 1938, Page 4

Poverty Bay Herald PUBLISHED EVERY EVENING GISBORNE, SATURDAY, DEC. 31, 1938. THE YEAR IN RETROSPECT

To-dny marks the end of a year which, in some respects at least, has been one of the most eventful in history. Dominating everything else, of course, has been the almost unprecedented anxiety and uncertainty. In China and Spain the wars have continued with little abatement and with little prospect of settlement, but these struggles for a time paled into comparative insignificance in view of the threat of a general conflagration in Europe. Just how close the great Powers were to war must remain a matter of conjecture, but the experience of the time and of the year as a whole made it clear that the world has not profited from the lessons of the last war nor achieved the objects for which it was fought. There is still no settled peace and no security and an inordinate share of the world's work is being directed towards the manufacture of armaments instead of to improving the. living standards of the people. Throughout the year the world has been precariously perched on the edge of a volcano waiting for what seemed to be an inevitable eruption. The year ends with the prospects not measurably improved, with doubts and fears uppermost in the minds of all peoples, but the experience of the recent past should have the effect of increasing the determination to utilise the coming year for constructive efforts for real peace.

The events of the past year, howover, are not all on the debit side. In the circumstances which prevailed there is ground for solid satisfaction in the knowledge that the statesmen of the world, and of Great Britain in particular, were able to avoid a tragic extension of armed strife. In the avoidance of war, some of the grievances which threatened it were removed and this means that the new year should open with less real cause of conflict. The conferences an(l negotiations which took place had the effect, also, of enabling the nations to reach a better understanding of one another's problems and points of view. It is true that some of the things which became more. clearly understood were not of an entirely pleasant nature, but knowledge, even if it is unpleasant, is better than ignorance. A number of new international pacts have been concluded, and even if, judged by past experience, these have little value, at least they can do no harm. Taken all round it might reasonably be argued, perhaps, that the year has been one of gain for the dictatorships, but even if this be true there is consolation in the knowledge that it has also been one of consolidation for the democracies and for this reason anxiety for the future is tempered by an increased measure of confidence.

In the economic sphere, also, the international trend during the year has not been altogether encouraging. Compared with the previous year there has been a reduction of world trade and prices have shown a downward tendency. The impetus that had been given earlier through rearmament programmes and inflationary measures brought about its inevitable reaction, but the deterioration was not so severe as might, in all the circumstances, have been expected. The competition of the nations to maintain their trade led to the adoption of various devices which, whatever their immediate and direct results, served in the aggregate to aggravate the general position. One notable "development in the opposite direction, however, was the conclusion of the Anglo-American agreement which had the effect of removing some of the obstacles from the channels of trade and may lead to further developments of a generally beneficial nature. At least it can be said that during the year a halt was called to the policy of raising tariffs and depreciating currencies and it is not too much to hope that the coming year will see a definite reversal of the trend that has been so detrimental in the past. If only international trade can be re-established on a normal basis other problems will largely disappear, for the only real foundations of world peace are the economic comfort and security of its peoples. New Zealand itself has had its full share of the world's anxiety and uncertainty and it faces the new year with the knowledge that it has difficult, but far from insuperable, problems ahead of it. As a primary producing country with its export trade the largest per capita in the world, its economic conditions are governed almost solely by world prices and this year the returns for its three principal exports, wool, meat, and dairy produce, are all on a reduced level. That position is bad enough, but, in addition, there is the fact that the quantitative production is also lower, so thai there must be a substantial diminution in the national income. The difficulties are.aggravated by reason of the fact that the Government has been returned to office wiih a mandate to proceed with a policy that is based on the assumption of a continuously expanding income. Since the foundations of the ■ policy ■ have been so seriously undermined it is clear that the carrying out of it must occasion deep anxjety. It has to be remembered, also, that in the past twp or three years the country has been living beyond * ts income and .has largely depleted its reserves, thus

rendering the task for the future even more difficult. Despite these adverse conditions, however, no one will question the inherent strength and capacity of the country, and its people will face the coming year with some concern, perhaps, but with undiminished confidence.