THE DOMINION

Timaru Herald, Volume CXXXVII, Issue 19598, 19 September 1933, Page 10

THE DOMINION

CONFIDENCE AS TO THE FUTURE PRODUCE PRICES MOVING UP By Telegraph—Press Association WELLINGTON, Sept. 18. Interviewed, the Rt. Hon. G. W. Forbes said it was gratifying to know that there was a strong feeling of confidence with regard to the future of New Zealand. The prices of commodities showed a definite upward tendency, particularly so in connection with butter, which had made a remarkable recovery from the disastrously low prices that ruled a few months ago. Cheese prices had also made a , recovery. The prospects for the wool season seemed very good, and competition in various countries was very keen. There was also reason to believe that meat would share in the general advance, and that by-products of various primary industries also would show a very substantial rise. His experiences at Home had led him to the opinion that prices of New Zealand’s primary produce had fallen lower than was really justified, but he j was glad to say that with returning | confidence, and the improvement in the general trade position in the United Kingdom, the demand for our produce was improving, with a consequent 1 rise in prices. Trade generally had ; made an excellent recovery in the Old Country, and the people were prepared to spend more freely than for a very long time. Debt ConversionMr Forbes w r as questioned regarding the prospects of New Zealand converting its overseas debt to a more favourable rate of interest. Mr Forbes said there was a short-dated loan of £5,000,000 falling due early next year, and the conversion of that issue would be taken up by the Finance Minister. Loan conversions were still under official control, and unless the time was favourable there was little use going on the market. The question of converting the loan was still the subject of negotiations between the New Zealand Government and the authorities at Home, and he had no doubt but that New Zealand would be able to secure as favourable terms as had been secured by Australia. On the question of general conversion of New Zealand’s indebtedness, Mr Forbes said that this matter was wrapped up with the question of increasing commodity prices. This matter had been discussed at the Economic Conference and also with the British Ministers, and it had been agreed that their endeavour should be to raise the price levels in order that they might carry their indebtedness. If commodity prices improved sufficiently—and there was already every indication that they -were on the upgrade—we would be able to pay our way and save the necessity for general conversion of our indebtedness. Referring to the New Zealand Governments’ action in pegging the exchange at 25 per cent., Mr Forbes said that the general view taken at Home was that, considering the seriousness of the Dominions’ internal position, the action taken was very moderate. “During my visit to England, I was asked the question as to what was the intention of the Government regarding the exchange rate. I told them that the Government had acted as it had done in order to restore j equilibrium for the farming or export- | ing industries, and there would be i a gradual reduction of exchange as the beneficial effects of the Government’s j policy were felt. I discussed this j question with bankers at Home, and I they said to me: ‘Don’t be in a hurry to bring it down.’ ” Currency Matters. Mr Forbes said they did not know what was going to happen in regard to currency questions, yet it had been freely prophesied by economists at Home and elsewhere that gold countries would not be able to remain on the gold standard. The whole question of exchanges and currencies was still in a state of flux. Nobody knew yet where the dollar was going to. The question of calling the World Economic Conference together again was more or less in the air, Mr Forbes said, and expressed the view that it would be impossible to call the whole Conference together again. He was inclined to the opinion that any future decisions would be undertaken by correspondence. Asked if any plans had been made for an early meeting of the Imperial Conference, Mr Forbes said that representatives of the Dominions had been able to confer with the British Ministers and had been able to deal with a number of important matters. He would say that it would not be necessary for the Imperial Conference to be held at the usual time. He was not in a position at the moment to say anything regarding the successor to the High Commissioner. He i indicated that he would take an early | opportunity of discussing a number of ; important questions with his colleagues | in Cabinet. Mr Forbes later attended a meeting of the Executive Council, over which j the Governor-General, Lord Bledisloe. \ presided.