IS BRITAIN PAYING HER WAY ?
I was prepared for a chorus of Ichabods as soon as the oversea-trade figures for 1937 appeared. The -.adverse balance of something over £432,000,000 on the visible items 'is admittedly formidable, but I cannot help thinking that some slightly morbid conclusions are being drawn. Last .year's rise of £x8o,000,00o, or 22 per cent., in imports was really no greater than might have been expected. Corrdcting for the price factor, I should say that it represented scarcely any increase in the physical volume of goods bought. Again, the big increases were in food, rubber, non-ferrous metals and machinery, in other words, just the' categories in which one would look for increases in a country_ enjoying a high level of internal prosperity and carrying through a large-scale rearmament programme. Is it unfair to assume, too, that the sharp rise in imports was partially the result of a stocking-tip policy, the effects of which have yet to appear in increased exports ? In any event, last year's rise of £95,000,000, or nearly 20 per cent., in exports, achieved with less help from the price factor than the rise in imports, is surely quite encouraging.
What of the invisible items in our external income and expenditure account ? We shall have to wait at least another month for the Board of Trade's estimate, but it is obViously safe to budget on a substantial increase on the 1936 figure of £330,000,000. Our net income from oversea investments must have risen by at least £2o,000,000, and so must the net income from shipping. Altogether, the invisible credits can scarcely have been less than £37o,000,00o, which would leave the net adverse balance as a result of all the external " revenue " items at just over £6o,000,000. Nobody will pretend that this is a happy position, but it is not alarming. So far as the stability of sterling is concerned, there need be no qualms so long as London continues to be the favourite refuge for mobile international funds. At present, r cannot 'see any trend in politics or trade which seems at all likely to embarrass our exchange position.
(Continued on pigs III.)
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