The Waikato Times With which Is Inooporated The Waikato Apgus. THURSDAY, DECEMBER 1, 1932. CONDITIONS ABROAD.

Waikato Times, Volume 112, Issue 18807, 1 December 1932, Page 6

The Waikato Times With which Is Inooporated The Waikato Apgus. THURSDAY, DECEMBER 1, 1932. CONDITIONS ABROAD.

Amid the general wall it Is cheering to read of signs of improvement fil Australia. The Assistant Treasurer of New South Wales, speaking at A country town, said unemployment was reduced, the revenue had improved, building had once more started, and confidence was returning. When we think of the condition of the State a short time since It is remarkable that a responsible official Is able to make such a statement. In South Australia a cheerful aocount is given of Increased exports of wheat, of eggs, and of wine: while, above all, the railways are showing a small profit, The Federal Government balanced its Budget last year, and hopes to do the same again. This Is a very remarkable record for a country which has suffered so severely by the fall in price of its two chief exports—wool and wheat. When we turn to Canada the tale is not so good. Canada has suffered badly from the fall in wheat prices. Like Australia, Canada has fostered industries under protection, and more of her population are engaged In Industry than In agriculture. The wheat-growers of Western Canada have been unable to obtain a payable price for their wheat, and consequently can buy little or nothing from eastern manufacturers. Canada has suffered also from duplicating her railway transport, for there are two vast systems running right across the continent, and interest on the cost of these is a heavy burden. Britain is reported to bo more hopeful and confident. The actual improvements in trade are not great, but the success of the big conversion loan has inspired hope.

in the United States conditions have been worse than in Britain, and though there are signs of improvement they are slight, and show more in prices dn the Stock Exchange than in increased buying of commodities. The Steel Company Is working to 18 per cent, of capacity and railway traffic shows some increase, but not up to ordinary seasonal gains. In spite of the Reconstruction Finance Corporation another railway system has fallen into the receiver’s hands.

If we attempt to compare different countries to see if any guidance can be found we find certain factors. Protection has not saved any country from distress, neither the United States, where It is of long standing, nor tho United Kingdom, whore it has recently been adopted. Australia, with heavy protection, is rather better off than most countries, and Canada, with heavy protection, Is rather worse off. Exchange offers a more promising field for comparison. Australia has adopted high exchange, compared with sterling, which is itself depreciated about 33 1-3 per cent, compared with tho dollar. Australia is showing distinct signs of improvement. It would not bo fair to attribute this entirely to exchange; there lias been a reduction of the cost of government, and of the rate of interest, but these together arc of less importance than the help received by agriculture from high exchange. Canada, whose position in many rcspCcis is similar to that, of [Australia, has not abandoned the gold

standard. Her connection with the United States is close and she considered that if she abandoned the gold standard it would greatly increase the weight of Ihe payments she had to make to the United States. She lias not been able to prevent some depreciation in the value of ihe Canadian dollar in the United Slates, but it Is not great. Australia to-day is in a better position than Canada. She has recently converted a loan which foil due In London at a very favourable rate of interest, though we were assured that this could not be done if exchange were raised. She recognised facts, and saw that it was useless to pretend that the position had not changed.

The position between Britain and the United Slates Is very similar to that between Canada and Australia. Britain did not leave the gold standard from choice, but from necessity. It adds greatly to the weight of the payments for interest to be made to the United States, and It lessens the value of the interest which foreign countries owe Britain, but do not always pay. In spite of these drawbacks Britain is more prosperous to-day than she was twelve months ago, when she abandoned the gold standard, To abandon the gold standard In Internationa; transactions is equivalent to raising the rate of exchange between countries which are on sterling. It is looking facts in the face. At present New Zealand lias money in London sufficient to meet Government commitments. This position has been brought about partly by the loan which was raised some months since. There is not enough money to pay for our ordinary imports. Business, both export and import, has fallen to a low figure and the Government is engaged in a vain search for some remedy to take the place of that which it is told by the hanks is contrary to precedent. We shall have finally to develop a mind of our own, but the delay is causing a vast amount of unnecessary suffering.