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of rationing exchange in present circumstances. The proposal appeared simply to mean replacing one form of control by another which would be less effective. Having regard to the competitive nature of banking business, it was thought that bank managers would be placed in an invidious position. The Committee advised the Government against adopting the proposals, for the following reasons : (а) Exchange control would not ensure a balanced importation of goods required for the economy of the country, nor would it adequately protect economic local industries. For these purposes, the authorities at present controlling import licensing have the most appropriate knowledge and experience. (б) A change-over from one system to another would involve some dislocation of business without any sufficient advantage. (c) It was doubtful whether the trading banks as a whole wished to have the responsibility of rationing exchange. (d) The progressive de-control of items was the best method at present of giving the maximum freedom to the importer within the limits of the availability of overseas funds and of local supplies. 13. Many of the other complaints were interrelated, but the main complaints may be summarized and commented upon as follows : (а) Complaint: Many items should have been freed from control in 'past years. Answer : This seemed justified, and the Licensing Schedule remedied the position from 1951 as to 326 items. Since this was done, 5 more items have been decontrolled. These 331 items have been de-controlled in the light of the following main considerations : (a) the probable effect of de-licensing upon overseas expenditure for such goods ; (b) their relative essentiality in the national economy (c) their relationship to local manufacture or supply. (б) Complaint: Licences should be interchangeable to a greater degree than has been the case.. Answer: This complaint covers two matters : (1) interchangeability between countries, and (2) interchangeability among the items of the import Licensing Schedule. The first matter is now provided for in the Licensing Schedule under the nondiscrimination provisions, with limitations only on currency grounds. The second matter has been met by de-controlling a large number of items. It is considered that where control remains there is good reason for this in respect of each item and interchangeability of the second class would weaken the control still considered necessary. (c) Complaint: The licensing system has not controlled imports effectively for the conservation of overseas funds. Answer: This is true up to a point. The Import Advisory Committee has taken steps to ensure that the limits upon the allocations in the present budget are not exceeded by the Departments. The Committee has also taken steps to introduce adequate statistical services which will enable the Committee to keep a closewatch on the issue of licences month by month. The full effects of this action will not be apparent for some months, and meantime the difficulty of insufficientand out-of-date statistical information hampers the Committee's work.

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