A WONDERFUL COUNTRY.

Timaru Herald, Volume CXXV, Issue 17945, 2 May 1928, Page 4

A WONDERFUL COUNTRY.

NEW ZEALAND AND PRODUCTION NO CAUSE FOR PESSIMISM. In view of the doleful predictions concerning the future of Now Zealand which are so offer heard, it is refreshing to be told the ether side of the story, and to know that there are those who prefer to “talk Now Zealand up," and prove that their optimism is well founded. A representative of the “Tirnaru Herald” had a talk on this subject, recently, with Mr CL S. Cray who had something of more than ordinary interest to say. Mr Cray said : “I have gone to some little trouble in taking from the Year Books the comparative figures, which cover the ex ports from New Zealand during the ten years ending 1907-1916, and the ten years ending 1917-1926, respectively. My purpose in extracting the figures lrom the Year Books was to ascertain jnst what proportion of the increased valno of our exports was duo to increased prices and increased quantities, respectively. My idea, is that no very useful purpose is served by comparing the figures of ono year with those for another year, and for the p'U'Pcwe of ascertaining the progress (or c-lierwire; of our trade it is preferable t,. a.erago the results for a term of years for comparison with a similar period. ‘One swallow doesn’t make a summer,' neither does the trade of a good < r bad year really represent a true | osition of affairs, but I claim that the trade figures in the official return fairy represent the trading progress <1 this country’s primary industries during the last ten years, and you will gather lrom the figures ■ that all pastoral precincts have shown a very substantial adv-rce on the quantities exported roivjthstanding the considerable' increase in local consumption, due to the lv.cice in population during the previous ti n years.

“The average exports for the last ten years amounted to £44,718,855, as against an average of £23,331,174 for the ten previous years, and after allowing for decreases in gold mining, etc. amounting to £772,790 there was a net average gain of £21,387,681, of which amount £12,388,071 resulted from the j yearly increase of pastoral products, j and the balance of about £9,000,000 from increased prices. “I think it is generally supposed that the large advance in the value cf git exports lias been due to increased prices, but it is clear from the figures that on the basis of pre-war quantities our exports would have averaged about £32,500,000 a year if we had relied on prices only, and in making this com-' parison it sems clear that this country's solvency has resulted from the increased quantities produced under the improved methods which have been adopted during recent years, and which the scientific departments of the Government have done much to encourage. ’lbis much is clear: That if we had limited our' production to pre-war averages, with an export trade of about £32,000,000 a year, it would not have been possible to import, as we have done, an average value for goods amounting to nearly £41,000,000 a year and it is equally manifest that if our productive power had not advanced as it has done, the standard of living would have been a very low one in comparison with what it is now. EXTRAVAGANCE.

“After looking into the trade figures relating to exports and imports I can see nothing wrong with this country except public and private extravagance which has perhaps over-balanced the wonderful increase in our primary productions and left us with an insufficient margin of exports in excess of imports to cover our external debts for interest charges, etc. It will be seen from the figures which- are readily accessible that the ‘balance of trade’ for the last ten years averaged £3,756,069, but this excess of exports over imports is involved with many conditions and may not correctly indicate the true balance available for our external debts, tut I understand; that we have to provide about £7,000,000 a year for interest on public and semi-public debts payable in London, and assuming that thp charge has averaged (say) £6,000,000 during the ten years under comparison, it would' appear that our balance of exports has been about £2,000,000 a year short of what is necessary for this purpose. Against this shortage there may be .considerable sums included in the imports which are represented by goods bought by the Government for public services, etc., and paid for out of loans raised in London, but even allowing for these margins it does seem fairly clear that our expenditure has been in excess of our earnings, and it is manifest that we must either, reduce expenditure (public and private) or increase our earning power to meet our present standard of living. Probably a measure of both alternatives will be useful and I am convinced that by improved methods of production the' earning power of the country can be advanced as much in the next ten years as in the past ten if reasonable encouragement is given to the opportunities that are available.

“As I am, in no way associated with any primary industry and know little or nothing about land cultivation I am not well qualified to offer an opinion on what cap be done to add to the productive power of the country, but I understand that an Economic. Commission has been appointed to inquire into and report on these matters, and porham the comparative figures I have r.i'hmitted may be of some . service to that Committee in recognising the con- ■ iderable increase of productive power I hat has been attained during recent voars. and which, so far as I can see, has not resulted from any considerable ■extension of land settlement; nor from any extra energy on the part of producers. but has resulted from better methods of farming. I attribute the increase in our pastoral products very largely to the use of suitable fertilisers, which is gradually being adopted h” the farming community and which would doubtless he more generally adopted if the cost of fertilisers could he substantially reduced. USE OF FERTILISERS.

My view is that the use of fertilisers" could be encouraged by a reduction of cost (say by 50 per cent.) The results would be reflected iu the general welfare of the population of .New Zealand and I suggest for tho consideration of the Economic Committee, the utility of reducing tho cost of all kinds of fertilisers by means of a State subsidy which, of course, would need to be met by some special taxation, unless it can be met by economy in public expenditure, sufficient for the purpo.se. If extra taxation is needed I suggest, that an expedient form would be to increase the charges for postage, by which means a. very considerable sum could be raised without much hardship on anyone and which would be shared on a fairly equitable basis. “We, who a,re associated with secondary industries, must recognise that the permanent prosperity for which wo are striving must depend on tho welfare of primary producers, and although for a time a false standard of prosperity ma.v be obtained through the expenditure of large sums of money on public works etc., the ultimate stability of all secondary industries must ho inter-locked with the success of the fanning community. I feel sure, from the inquiries T have made, on this matTcr. that the more extensive rise, of fertilisers would well repay tho cost incurred and anv consequent taxation, for it is' clear that many farmers need smno encouragement to meet tho high nest of production, and in my view it, is better to help them to- help themselves than to permit the present despondency

to continue. One hears a good deal about tho high cost of land, and obviously if there is any truth in those statements, the extra cost must either he met by making the land worth what it has cost, or come down to a lower standard of values, involving the bankruptcy of those who will be compelled to relinquish the land they have bought too dearly, and permit its occupation by others at prices which will admit of "profitable work. The subject is too involved to justify my troubling you with any opinions of mine.

“If you want further evidence of the enormous advantages of increased production you will find this evidence in my comparisons, and you will see that although the prices of nearly all pastoral products fell during the year ending 1927, the considerable increase in the quantities exported, largely balanced tlie loss of market prices and added something like £4,000,000 to the value of our exports for 1927 above, ti. average for the previous ten years. If prices had been equal to tho previous market averages the actual gain would have b over £8,000,000. Following is a state showing tlie loss on the exports tor 1927, duo to fall in . prices below the previous average for the ten years ending 1917-1926:

“I have given the above figures to show that the drop in market prices has meant a considerable loss to a good many producers, which is not balanced so far as they are concerned, by the extra quantities sold, although to the country generally this increase has meant an advantage of £4,O(JU,UOO or more, for it does not include ‘other pastoral products,’ of which I have not any figures available. NATIONAL STABILITY. “I am trying to. explain that in my opinion our national financial stability is more dependent on increased production tnat on market prices, though it is obvious that prices must bo maintained at. a payable average to warrant the necessary enterprise on the part of producers but some help needs to be extended to the people engaged in the primary industries, to promote and encourage production on an increased scale, and to encourage further settlement of people on the land. I believe that reduction! in the cost of fertilisers is one way to assist the national welfare, for any gain that can be secured in primary industries is sure to be reflected in tlie secondary industries also and,per contra, loss and reduction of exports must affect the general prospevity of this country. I feel confident that even if the encouragement of the primary industries needs to.be met by special taxation it will be warranted by results and will be more than balanced by the advantages we shall obtain in our trade balances in all industries.

“My opinion can he of very little value, but apart from the necessity of encouraging production by cheapening fertilisers I suggest the necessity that exists all over New Zealand for the improvement of areas of land that have been allowed to become unproductive through neglect This weed-infested land in many cases is owned, or leased, by farmers who are unable through financial difficulties, to bear tho cost of cleaning this class of land and 1 bringing it back to a. proper condition for cultivation. Would it be in tho public interest to encourage the improvement of this class of land by providing financial help through Government expenditure, or advances, on terms that would be useful to tlie fanner and safe to the State? It is clear that much of the dirty land referred to is of no advantage to the owner, or occupier, in its present condition and so. far as the value to. the country is concerned it might as well be oil the hill tops and covered with snow, unless its productive value can be redeemed. If this value can be restored it will be to the advantage of the country to bring it hack to a profitable condition, provided the outlay is justified by probable results. If any loans could be made for-this purpose the advances could bo made to rank like rates and taxes ip advance of existing mortgages, and it would probably be necessary and prudent to pro-ararnge that" such expenditure should receive the approval of mortgagees as a condition of the loans being made. It would also be necessary to insure the proper fulfilment of the work under supervision before the payments were made for same.

DESPONDENCY NOT JUSTIFIED. “In ilie course of a recent business trip through New Zealand I visited a good many places in both Islands and I was struck by the general tone of despondency and pessimism that is 1 prevalent everywhere. In many of the towns I visited business. men whom I met seemed to rival each other in expressing mistrust in the future of this country, and talked about bad times in a manner which is certainly not warranted by the trading figures, for it is dear from those figures that even allowing l'or the increased cost of production” on a liberal basis there has never been a period in tho history, of Now Zealand whore its prosperity, measured by quantities and values, lias been anything like equal to what has been obtained since the war ended; and with reasonable economy in public. f ,nd private expenditure and come encouragement extended ro the primary industries, T am confident, that this country can easily meet its externa! debts ; u the future and can maintain the present standard of living but of its increasing income from products, by more intensive cultivation; but for a few years, till tlie more embarrassed members of the farming community are put on their feet, it will be prudent to help thorn, provided they are willing to help themselves in some such manner as I have- suggested. “It seems to me that wo are* ltko a healthy man who lias boon told too frofluently that lie is not looking v,ell, ami persuades himself that he is really ili There cannot be much wrong with New Zealand except that it is recovering from a burst of extravagance and is”no\v suffering from the reaction. 8 OUT IT CANTERBURY’S PART. “Unfortunately,” said Mr Cray, m conclusion, “South Canterbury cannot claim to have participated in the increased production, but so far as I know there is no reason whv this district should noli do its share.”

Loss Due Exported Loss on To Price Pastoral Products 1927 Average Price Failure 1927 s. d. £ Wool (lbs) 220.510,714 0.43 395,032 Frozen Meat (cwts) 3.365. 104 3.18 44,587 Butter (cwts) 1.455,t573 26 0.77 1,896,914 Cheese (cwts) 1,492.792 13 6.32 1,382,772 Tallow (cwts) 477,500. 12 3.84. . 294,135 Hides and Skins (No.) 1,368,338 2 5.23 166,652 Sheep Skins and Pelts (No.) 9,913,453 0.23 9,505 Total market loss due to reduced prices below average for previous 10 vears, 1917-26 4,189,647 Less gain on 12,928,689 rabbit skins at 2.71d 145,936 Net loss due to reduced prices below average . £4,013,661