LETTERS TO THE EDITOR
INTERNATIONAL TRADE
Snt,—In your editorial ".The Washington Talks " of September 14th, I find the following statement—" It (the Ottawa Plan) has produced an expansion in intra-Imperial trade, but resulted at the same time in a sub- stantial, reduction in international trade." This is entirely contrary to the facts. To deal with international trade first, the League of Nations Review of World Trade, 1937, shows that the quantum of world trade, which had been falling from 1929 to 1932 (the year of the Ottawa Agree- ments), immediately thereafter started to rise and continued to do so until the year 1937." World imports'increased by o.8 per cent. in 1933 and by 0.4, 4.3, 5.1 and 12 per cent. in the subsequent years ; exports increased progressively by 1.3, 3.1, 5.1, 4.7 and 14 per cent. The quantum index, taking 1929 as too, fell steadily from that year to 1932, when it was 74.6. From then onwards it rose steadily and regularly, until it had reached 96.8 in 1937, the highest figure at which it had stood (except in 1929) for 53 years, 1924 being the earliest year for which the League of Nations supplies figures.
The submission, had your statement about international trade been true, that the Ottawa Plan was responsible for the decline, is equally easily disproved. Intra-Imperial trade certainly increased, but reviving trade between countries of the Empire, far from restricting their trade with foreign countries, stimulated it. The imports into the Dominions, India and Burma from British countries and from foreign countries increased between 1932-37 by almost the same percentage. The same is true of imports into the Colonies and Protectorates and the Mandated Territories. It is not true of imports into the United Kingdom, because the Import Duties Act had done the job which it set out to do and transferred a large proportion of our purchasing power to the import of raw materials rather than of manufactured articles, and the raw materials came largely from Empire countries, whereas articles are normally sold to us by foreign countries. Nevertheless, our total purchases from foreign countries were in 1937 substantially larger than in 1932.
The fact is that up to 1932 the world was suffering from economic fear.
The Import Duties and the Ottawa Agreements Acts in that year gave Imperial countries freedom from that fear and established a confidence which spread throughout the world. The diversified character of the British Empire is in a position peculiarly able to influence world con- fidence, and if„ as Lord Keynes suggests, we now propose to jettison Imperial Preference we shall indubitably destroy that confidence once more and run a grave risk of throwing the world back into the chaotic
conditions of 1929-32.—Yours faithfully, , W. A. WELLS, Empire Industries Association, News Editor. 9, Victoria Street, London, S.W.i.
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