Evening star., 1946-07-14
BY the Associated Press

LONDON, July l3.--br1tlSh On-
cials regard the $3.50 900 900 United
States loan as pump primer which
will start trade flowing all over the
globe and return Britain to its pre-
war position as "middleman to the
world"
The approval helps Britain to
dodge some drastic belt Tightening,
because. as one government source
put it, Britain was already Scraping
the bottom OF the barrel" of its dol
lar resources.
Trade was trickling across the At
lantic in advance. One Of the first
payments from the loan will be for
still undetermined amount Of goods
already in the pipeline.
To the British man in the street
the outward effect OF the loan will
barely be visible.
| Will Relieve Austere Diet.
! His wife may notice it in the gro
Gerry stores, for part Of the money
will be spent on American dried
eggs, canned milk, canned fruit and
fruit juice But there will not be
enough of these things for a splurge
on the table; just enough to knock
little OF the monotony out of the
auStere British diet, which now is
even below wartime levels.
Newspapers probably will expand
to six pages from their wartime four
under what one official called
"gentlemen's agreement to import
more newsprint for publishers who
have been increasingly fretful that
they have too little space to explain
the pros and cons of Socialism.
The rate Of spending will be deter
mined by sort Of British economic
high command headed by Chancellor
of the Exchequer Hugh Dalton.
Every three to six months this
group meets to scan available money
for imports, allot the amounts which
may be used for certain products
and assign priority to them, so that
the funds may be spent only for
items considered necessary to rebuild
the country'S tattered economy.
The American fund will be
handled the same way.
Will Buy American Machinery.
A large proportion of 1t will be
spent on American machinery. Bri-
tain's economic chieftains regard
this as the fastest way to whip a
manpower shortage, particularly in
the coal mines.
Imports of cotton from the United
States likely will be somewhat below
the 1898 volume of 887 900 bales, an
official said because B.itains cotton
industry is bottlenecked tn anti
quated machinery and a shortage of
labor in the spinning mills But he
said American cotton still will find
good market here.
without the loan. both Britain
and the United States would have
felt restrictive effects.
For instance the official SAID there
would have been no way TO avoid
blocking payments for Hollywood
films, which now will remain free.
and that the Virginia tobacco, which
makes Britons' favorite smokes.
would virtually have disappeared
here.
Diplomatic and business men say
they expect the loan TO inject new
life into trade between the United
Kingdom and the Latin American
countries and to allow resumption
here of imports such as Colombian
coffee. Cuban tobacco and Brazilian
raw cotton.
British and other European Off
cials agreed trade in all Western
Europe would be speeGed up.
Goods Will Satisfy Debts.
Most European countries are cred
:tors to Britain. BY accelerating
Britain's industrial processes and
making more British goods avail
able for export. these debts can be
satisfied with goods.
One consequence Of the loan.
British official explained. is that
Britain now can begin to negotiate
with theSe countries on the freelng
Of small amounts-perhaps or
per cent-of blocked sterling credits
for conversion into dollars with
which they can buy American goods
Within year Britain also must
make the proceeds of all current
transactions available for full use so
that, after that time. any country
with a favorable trade balance with
Britin may use its pounds as it
desires.
India is the biggest creditor. Her
bill against Britain. mainly for keep
ing British troops there during the
war. now stands at abOut II .240.O0O,-
900 ts4 960, 600, ,O00p.
Dollar Position Still Grim.
Even with the loan. said Prime
t1 III