HIGH TARIFF AND TRADE

Taranaki Daily News, 6 November 1930, Page 10

HIGH TARIFF AND TRADE

AUSTRALIAN REACTIONS.

UNEMPLOYMENT IN BRITAIN.

A statement discussing the effects of the tariff increases and import prohibitions introduced by the Government of Australia was . issued recently by Mr. S. F. Ferguson, the Federal secretary of the Australian Association of British M amif acturers.

“Eleven months ago the Government embarked upon a policy of extreme protection,” he said. “Five months later it introduced the new principle of outright prohibition of certain classes of imports, Tanging from steel girders to canary seed. Mr. confidently predicted a vigorous trade revival. The association predicted, with equal certainty, that the tariff would drive business deeper into the mire. Extreme protectionist policy has since been on "trial 'for its life. It has\had an opportunity unprecedented in history to prove its efficacy. The general position in Australia is now much worse than it was before the duties were increased in November.

"The Government has attempted to restore the trade balance by artificially reducing imports, instead of by the rational course of increasing exports. The possibility of profitable export production would have been greater had the tariff remained as it was, and greater still had duties been reduced. The enormous increases and the prohibitions have served to prevent; export producers from profiting by declining world price movements. Exporters were compelled to sell in a. market* in which prices were dropping, hut were not permitted to benefit, in, their purchases, by that same movement. But for the tariff increases of the past year, Australian prices would have.been forced down in common with world prices, owing to competition with imports. Prices are now being forced down belatedly, not by external competition, but by a much less healthy influence, namely, unemployment and the reduced buying power of the public. In effect, the tariff was used in an attempt 'o. throw upon the export producer the whole loss arising out of .price movements overseas. Export expansion

in such circumstances was highly improbable.'. In addition, Australia’a tariff policy, rushed into effect in such a manner as to set at naught all international courtesies, has provoked retaliation by other nations, with further serious consequences to the export trade. “By reason of Australia’s reduced purchases from Great Britain, it is estimated that 1'50,000 British people have been thrown out of emplpyment. Thus 150,000 of Australia’s best customers have temporarily become unable to make I their usual purchases of Australian pro- | ducts. Australia’s callous disregard of the effects upon Great Britain and other nations of the measures she- adopts has contributed in no small degree to the world depression that has so seriously accentuated; Australia’s own difficulties. “The association does not criticise the Government for having made the experiment. -It merely urges that, as the exp< ment has proved a failure, no. time should be lost in attempting to undo the harm that has been done, and to take the necessary measures to place Australia’s trade upon the path which will lead to an eventual restoration of prosperity.”