CONTROLLED EXCHANGE.

Wairarapa Daily Times, 16 January 1932, Page 4

CONTROLLED EXCHANGE.

It is claimed by the Government that in the pooling of her overseas credits New Zealand is doing no more than following the example of Australia. New Zealand, however, is going a great deal further than Australia. Australia is leaving her exports free and her export trade free. To export now from New Zealand a license must be obtained. The Pviuu Minister stated that licensing would bring about the pooling of exchange resources with the minimum of inconvenience to the commercial community. But a license limits the commercial community to transacting its exchange business with the banks. An exchange transaction must be negotiated through a bank. It is an endeavour by a government to prevent competition, and so to control, not only the disposal of exchange, but also the rate of exchange. Where goods exported from New Zealand are sold in Australia the money realised is to be paid into the principal office in the State capital of the bank through which the exchange transaction is conducted. Where goods exported from New Zealand are sold in England or on the Continent the money realised is to be paid to the principal London branch of the bank through which the exchange transaction is conducted. In effect, if not intentionally, the licensing system .is designed to eliminate all. outside market exchange transactions.