World Trade Drying Up The extent to which the general
policy of restriction is causing the drying up of world trade is shown in the annual report of the London Chamber of Commerce. It calls attention to the fact that in 1933 world trade had fallen to one-third of its value in 1929, and that in 1934 there was a further fall. Every country, in 'seeking to establish a trade balance, has endeavoured to increase the ratio of its exports to its imports ; and since the customers of every country have been doing the same thing, this has involved a continuous cutting down of imports. A continuation of the process would lead to the complete extinction of international trade to the detriment of everyone. Great Britain, it must be added, has been no -exception. We, too, have been contributing to the general shrinkage by cutting down imports, though foreign trade is more. necessary to this country than to any other. Economists of all nations are aware of the vicious circle. There is no way out except by agreements to exchange, and by taking account of the fact- that the more -our customers can export the greater will be their purchasing power.
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