GERMAN DEBTS.

Star (Christchurch), Volume LXVI, Issue 20341, 26 June 1934, Page 7

GERMAN DEBTS.

Mr Neville Chamberlain’s Statement. SECOND READING OF BILL. Brit .Ph Official Wireless. (Received June 26, 1.30 p.m.) RUGBY. June 24 The Chancellor of the Exchequer (Mr Neville Chamberlain), in the House cf Commons, moved the second reading of the Debts Clearing Offices and Import Restrictions Reprisals Bill, a i measure to deal with the situation cheated by the decision of the Reichsbank to suspend for six months, as from July, all cash transfers on German long and medium-term debts abroad, including the Young and Dawes loans. Mr Chamberlain expressed regret that the Government found themselves bound to introduce this measure. lie said that there was no doubt that the position of Germany in regard to foreign exchange and the necessary discharge of her obligations was* one of very great difficulty. In the German Note to Great Britain a great deal of emphasis was laid upon the reduction in the Reichsbank reserve of gold and foreign exchange, and it was said that this reserve had been sacrificed in an effort to maintain payment of German obligations. The fact was that a very great part of this serious diminution in the reserve had been due to a device adopted by the Reichsbank, which, in its effect, was equivalent to depreciation of German currency. Rightly or wrongly, the creditors of all countries no longer felt the confidence they had in the good faith of Germany. The Door Open. In the British Note it was made clear that the door was still open lor further negotiations, and the German Government was invited to send representatives to London for discussions in the hope that it might be found possible to avoid using the powers which were sought in the Bill. He was happy to say that this offer had been accepted and he sincerely hoped that it might be found still practicable to mc.ke seme arrangement with the German authorities, which would ensure fair treatment for the British bondholders and British traders before July 1. All the same the Government could not postpone the request for the necessary powers in the hope of a solution, which might, after all, be found impossible, and they asked that the Bill be passed through all its stages so that, if it should prove necessary, they might have to put it into force to see that British nationals were fairly treated. In regard to the provisions of the Bill, the Chancellor said that the Government did not like quotas. They had no present intention of imposing quotas and they must hope that it would not be necessary to use the powers contained in Clause 2. Although he had spoken only of the differences with Germany in this matter and although, in fact, it was only urgent difficulties that had caused the Government to introduce the Bill, the clause was not confined to Germany and was drawn in such terms as would enable it to be applied to any other country if the need arose. Interference With Trade. Everybody must be aware that it was not possible to resort to a measure of such a kind without a certain amount of interference in the normal course of trade, and everybody would desire that this interference be limited as far as possible. With a view to the widest and most careful consideration of any difficulties that might from time to time arise in the administration powers sought in the Bill, the Chancellor proposed to set up a small advisory committee, comprising representatives of the Treasury, the Board of Trade, the Bank of England, the Joint Stock Banks’ Federation, British industries and Chambers of Commerce. The German delegation, which is expected to arrive in London to-morrow, will consist of Dr Berger, of the Finance Ministry, Dr Ulrich, of the Foreign Office, and Herr Blessing, Director of the Reichbank. Dr Berger will head the delegation. During question time in the House of Commons, Mr L. Hore-Belisha took the opportunity offered by a question to make clear that there was no intention of treating bank balances as debts, to be cleared or to use the powers under the Debts Clearing Offices and Imports Restrictions Reprisals Bill so as to interfere with them in any way. He also mentioned that the nominal capital amount of the sterling issues of the Dawes Loan held in the United Kingdom was about £10,000.000. and of the sterling issue of the Young Loan about £9.000.000. The amount of German obligations held by .persons in other parts of the British Empire was believed to be small. BILL PASSED. (Received June 26. 12.50 p.m.) LONDON. June 25 In the House of Commons, Mr D. R. Grenfell, following Mr Chamberlain. 1 said that Labour regretted the neces- j sity for the Bill. Sir Herbert Samuel agreed that Ger- I many had not acted ‘rightly. There j was no justification for her default. i The Bill passed its second reading j without division.