Germany's " Standstill " Credits The negotiations begun in Berlin
on Tuesday for the renewal of Germany's " standstill " agreement with her foreign creditors throw an interesting light on Germany's financial methods. Germany's short-term indebtedness has by now been reduced to £96,000,000,—during the last two years by withdrawals of registered marks, a method of payment which inflicts heavy capital losses on Germany's creditors. Germany still contends she cannot pay in foreign exchange : yet last year her trade surplus amounted to £46,000,000. Moreover, the Reichsbank, whose recent returns show no increase in holdings of foreign exchange, is believed to have at least M15o,000,000 more than the figure declared. The recent law impelling German citizens to surrender foreign exchange holdings, under penalty of death, to the Govern- ment, is thought to have brought in at least kr 5,000,000 (to which Herr Ossietzky's Nobel Prize contributed £8,000). The truth is that Germany's foreign exchange is being used for rearmament and her political activities abroad ; moreover her export trade is itself being sacrificed to rearmament. Her creditors may therefore reasonably press for capital repayments in foreign exchange. Their arguments, however, have so far only had reason behind them ; it is interesting to find it suggested that, as the holdings of German citizens abroad are now the property of the Government, a threat to " block " them might assist foreign creditors to obtain more favourable terms.
Previous page
