The Bridgeport times and evening farmer., 1920-03-09
AUSTRALIAN
 GOVT. PAYING
 LOW DEBT RATE

How Australia paid and equipped all soldiers whom it sent to the war and emerged with an aggregate fed eral and state debt of $3,750, 900, ,O0O> bearing on an average an interest rate of less than 4 per cent was told Tues day in New York to members of the Bond Club at their monthly luncheon in the Bankers Club by Mark Shel- don, High Commissioner for Australia, vice president of the Chamber of Commerce of Sydney and president of the Australian Bank of Commerce During the war the federal govern ment of Australia borrowed a large portion of it's funds at Az per cent, free of all taxation. and the balance at 5 per cent, subject to taxes. Some of it's earlier borrowings from Eng land had been consummated as low as 3 per cent, and thus the average for all of the outstanding debt is less than 4 per cent
 Taking up the subject of exchange and the value of the pound sterling, MT Sheldon said that the investors in the United States were prone to un- derestimate the resources of the Brit ish Empire He pointed out that Australia, New Zealand and India ex- port much more than they import, and that the favorable balance of trade goes to help out England's financial position through the fact that inter est has to be paid on the debt to the British Empire and that London is financial clearing house for the ex- change operations of all those coun- tries. He estimates Australia's fla vorable balance of trade in 1920 as between $15e,00O,00O and s2O0,oOo,- 1B- would be equally large.
 According to MT. Sheldon, the chief result of the depreciation in pound sterling will be that the countries which compose the British Empire will have to trade more and more with each other. He pointed out that the resources of Australia have been 1 merely scratched and that the coun- try could find immediate employment for 10,000,000 additional persons. As to the wealth of Australia, he said | that among 5,000,000 people there were :, TOO 600 savings Accounts av- eraging $20O each.
 MT. Sheldon declared that there was no possibility of establishment of di- rect exchange between Australia ano l the United States and that the bal ances would have to continue to be l settled through London.
 MT. Sheldon informed members of l the Bond Club that Australia is larger | than the United States in territory and represents a quarter of the British i Empire in size. but has only 5,O0O,00O poopulation, of which 95 per cent was | English speaking. Its constitution l he said, was modelled after that of the i United States with federated states 1 trTy1- saIz
 ways of Australia, owe about s2,000,- | 900, which is well secured by prop l erty developed when costs of con- struction additions and betterment: 1 and financing were much lower thar they are today.
 | Of the total state debt no less thar SS per cent. represents expenditure for reproductive works About 62 pel 1 cent. was used to construct, equiI
 and operate the railways, about 16 F | to develop the water and sewerage | supply and about 1 0 in dock, shippins | and terminal Improvements. Tht | railways, which provide about half o,
 the revenue of the states. thus payinE 1 the interest on the entire debt, no only pay their way but apply fund.-
 toward a gradual retirement of tht debt.
 1 Of the obligations of the state
 about a third is held in Australia am
 two-thirds in England. The figure
 are reversed in the federal debt, 0
 which about so per cent. is held il
 Australia and 20 in England Of tn l funded federal debt of $1,50O, 900, %
 and the total obligations of about s1,
 750,000,000, practically all of thei proceeds were expended during tn war. The loans of the commonwealt isen from 96 to 971A. based on matur ity.