EMPIRE CURRENCY PLAN

Taranaki Daily News, 18 June 1932, Page 5

EMPIRE CURRENCY PLAN

EFFECT UPON AUSTRALIA PRESENT EXCHANGE BENEFIT MR. S. M. BRUCE’S OPINION LIVELY HOPE OF SOLUTION By Telegraph—Press Assn. —Copyright. Canberra, June 17. Commenting on recent cabled references to an Empire currency, Mr. S. M. Bruce, Assistant-Minister of Finance, said that while it was possible that valuable steps could be taken at Ottawa to link Empire currency into a stable ■and harmonious system, they could not be such as would endanger Australian primary industries.

“It is practicable at present to bring about'parity between currencies in different parts of the Empire on the basis suggested in some quarters,” he said. “There is, however, a* broader sense in which an Empire currency is not only a possibility but a very lively hope. It may be possible for the Dominions to agree to link their currencies with sterling at ratios which can be kept fairly stable though different for each Dominion. Measures can then be concerted for keeping sterling, and therefore the whole system, under control. ■ “With such a basis of stable exchange through a wide range of countries it may be possible to plan a number of measures for the promotion of lower interest rates and the encouragement of investment, which would assist general recovery within the sterling group and give a lead to the world.”

Though elaborate schemes have been worked out in the preparation of Australia’s case for presentation at the Ottawa conference there is a danger of the whole preparatory work being ultimately rendered useless, said an Australian Press Association message on Wednesday. Many sets of figures have been carefully worked out, envisaging the imposition by Britain of various duties on different commodities of foreign origin in the interests of the primary producers of Australia and other Dominions, whose products would be admitted to Britain free in return for increasing preferences to certain British manufactures in the Dominions, but it is understood that throughout all the calculations on Australia’s behalf it was apparently assumed that the present 25 per cent, exchange between Britain and Australia would continue indefinitely. Ever since it operated this exchange has had the effect of giving Australian producers a bonus of 25 per cent, above the low world prices of commodities which have prevailed in recent months. If the Ottawa Conference were to adopt an Empire sterling currency as advocated in many influential quarters, the the exchange would disappear. In such an event the Australian producers might be landed in an even worse plight than at present. They might, possibly, for example, receive a 10, 12J or even .15 per cent, advantage as against foreign producers, yet lose on the deal through the disappearance of the present exchange.