The Wanganui Chronicle TUESDAY, DECEMBER 3, 1935. OUTLOOK FOR WORLD TRADE

Wanganui Chronicle, Volume 79, Issue 283, 3 December 1935, Page 6

The Wanganui Chronicle TUESDAY, DECEMBER 3, 1935. OUTLOOK FOR WORLD TRADE

A-' interesting survey of world economic conditions .was made last week by Sir Thomas Buckland, president of the Bank of New South Wales, at the annual meeting of that institution. A feeling of hopefulness was expressed concerning the outlook in Australia, although there was a reference to developments abroad which, in view of their bearing on conditions in this part of the world, cannot be ignored. After observing that the volume of world trade was still 23 per cent, below that of 1929, and its value, measured in gold, was only one-third of what it was in that year, Sir Thomas referred to the policy of economic nationalism which has, as a defensive measure, extended from one country to another until il has now been almost generally adopted. This suicidal policy in trade obtrudes itself as a cheek upon, and obstacle to, the restoration of industrial activity to a level that would stimulate a process of world recovery. Sir Thomas Buckland is driven, therefore, to the conclusion that it would be unsafe to assume that substantial improvement in world conditions is to be expected in the near future. He also points out that some of the recovery has been associated with the new armament race upon which the world seems to be embarking, and adds that such, a policy of public works expenditure may stimulate industrial activity, but it is more wasteful in the end than much of the oftcriticised public works. Sir Thomas pertinently points out that the measure of self-sufficiency that has. been attained by nations through the erection of-barriers against the exchange of commodities has been procured at the cost of a lowering of the standard of living in the countries concerned. The view is offered that the best hope of reversing the trend towards economic nationalism lies in some agreement upon the question of monetary stability. That depreciated currencies and fluctuating exchanges operate most adversely upon world conditions seems obvious, but as has been indicated only recently in the discussions in France on the monetary crisis in that country, there seems no possibility of early world currency stabilisation. hi his review of New Zealand conditions, Sir Thomas Bucklaud makes the statement that there is little virtue in the National Government’s policy of reducing the public debt. The suggestion seems to be that an increase in the annual interest ■ harge, through an expansion of the public debt, would be of gieater practical value than a policy of heavy taxation and debt recovivy. Taxation is severely heavy in New Zealand, and one of the points in the programme of the party which is coming into power that will have recommended it to members of electors is its promise of relief in this respect in several directions, and its declaration against any increase in taxation. The new Government is also against increasing the loan indebtedness of the country, while the National Government also made strenuous efforts tn this direction and actually brought about a decrease in the public debt. Sir Thomas, however, regards a continuation of the old policy of borrowing as actually desirable, although he must know that there must be a reckoning some day. At the present time a legacy of public indebtedness of almost crushing volume is being bequeathed to posterity, and il does not require a great deal of imagination to realise what would happen if a greater burden of fixed charges had to be faced under conditions similar to those ruling during the last four years.