Courtesy Reuters

International Credit and Currency Plans

WHATEVER may be the ultimate fate of the plans themselves, the publication last year of American, British and Canadian proposals regarding postwar currency arrangements has precipitated an interesting public debate which has thrown a great deal of light on some of the basic issues involved. In view of the dense cloud of mystery and suspicion which frequently surrounds international finance, it is essential that any covenants reached in this field should be open and openly arrived at. The unusual procedure of Treasury officials in different countries inviting the world to witness them in the process of thinking out loud (and thinking their own private thoughts rather than the thoughts of their governments) has been justified by the results. After a year of vigorous discussion, a wide area of agreement on essential points has now been reached among the officials of a large number of countries. This agreement has been embodied in a "Joint Statement by Experts on the Establishment of an International Monetary Fund," published simultaneously in April 1944 in several capitals, including London, Moscow, Washington and Ottawa.

The Fund proposal is one contribution to the task of reconstructing a functioning international economic system; and its potential usefulness is clearly conditional upon parallel action on cognate problems such as commercial policy and international long-term investment. In turn, tolerable international economic arrangements will not endure, and competitive currency depreciation, excessive trade restrictions, barter trade deals, rigid and stultifying exchange controls will not be avoided, unless the great industrial nations are successful in maintaining a high and reasonably stable level of domestic economic activity. No international arrangements, monetary or other, will survive if the large countries so mismanage their affairs that they are half the time in the doldrums and the other half in a cyclone of activity.

The details of the Fund proposal have been fully discussed and an impressive body of literature has already been produced. In Canada we have followed the discussion in the United States with attention. I do not

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