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DECEMBER 9, 1947 THE DAILY TIMES-GAZETTE PAGE NINE "INTERNATIONAL EVENTS AFFECT CANADA A. E. Arscott, President, The Canadian Bank of Commerce, says: This Country Could Ald ' Britain and Europe INCREASE OF $108,000,000 IN LOANS OF BANK Reported by S. M. Wedd Vice President and General Manager At the Annual Meeting of the Shareholders of The Tanadian Bank of Commerce, held in the Head Office of the Bank in the City of Toronto, December 9th, Mr. Allan E. Arscott, CJ .E., Presi- dent, and Mr. Stanle, . Wedd, Vice-President and General Man- ager, presented the Annual State- ment of the Bank's operations in the past year, together with a re- view of business conditions. Mr. Arscott"s address to the meeting follows, in part: The records of production in our industrial and manufacturing plants have been excellent resulting 'in substantially larger pay-rolls to em- ployees and setting new high marks in the volume and variety of goods on domestic and foreign markets. Our satisfaction with these results is tempered in some degree, however, by crop yields in many sections of the country lower than those of last year and by a decline in the output of some minerals to even less than the requirements of essential needs. Manufacturing and industrial units have continued to expand, but many capital investment programmes plan- ned during the past two years, both for new buildings and replacements of machinery, are not yet completed owing to delays occasioned by mate- nial shortages and the lack of adequate skilled labour. With the new regula- tions recently announced for curtail- ing imports of machinery, equipment and other materials which are obtain- able only with payment of United States dollars, these programmes for Sxpansion will doubtless be further delayed. \ Notwithstanding all the difficulties sidering our resources and population in comparison with others, we have given great assistance in an endeavour to restore an effective economy to those countries which were severely affected by the war. Owing to the accelerated drain on our reserve of United States dollars, however, we were faced with the [necessity of when we consider the over-all material well-being throughout the Dominion all must ages that we are indeed fortunate. e hearts of the people in this highly favoured Continent assuredly will go out in full sym- pathy to the le of Britain, enduring measures of severe austerity, and to the Inge plight of the fam- ished nations of Continental Europe, facing again the rigours of winter with wholly inadequate resources of food, fuel and clothing, and living in constant fear of revolutionary vio- lence and civil war. It i& disappointing that the neces- sity has arisen for the reimposition of restrictive measures which affect the coursé of business and oye affairs, but we must remember that there is an unusual situation in the world to-day from which we cannot stand aloof. The common sense of the citizens of Canada, I am sure, will prevail and they will discipline devising some to port temporarily, and ultimately adjust, our unfavourable balances of trade. In this connection it is reassuring to nate that in the pr Is now under consideration in the United States for giving aid to the European countries, it is indicated that supplies may be purchased in the other countries of | the American continents, which should help our trade position. In this spirit it is suggested that attention be directed to our resources and production facilities with a view to determining the maximum quanti- ties that can be allocated abroad. Time is an important factor and for a while it may be nec to con- serve in home consumption, if Canada is to share to the extent that could be reasonably expected in this present world crisis. PRICES Lower crop yields and the with- drawal of subsidy payments to which I have referred, have collectively contributed to the rise in prices. Upward adjustments in es to compensate for higher cost of living are also a major influence on the cost of production and distribution with resultant effects on price levels. In the main these are the chief elements that combine to accentuate the up- ward movement of prices. The extent to which they may rise depends on how soon production catches up with d d buying tapers which have been and which to be overtaken in domestic trade, the dollar volume of sales generall has been maintained at a high level. There are signs, however, of more selective buying by the public, and on more extended terms of payment. FOREIGN TRADE Foreign trade increased to record proportions. The combined figures of exports and imports for the first ten months of this year exceeded $4 billion; m s of Canadian pro- ducts abroad--<«in dollar terms--over- Balancing Canada's purchases from other countries. The dollar volume of this year's exports is practically double that of pre-war times. While this in itself is a notable development, it must be remembered that in part at least it has been of an unusual character since a sizable portion of our exports has been financed internally. Canada's trade, in manufactured goods and in agricultural and other ic products, depends for activity on the prosperit of other nations. Before the second world war, Canada ranked high in trading operations among all the nations of the world-- fourth in exports and eighth in imports--a commendable position compared with other world-trading countries. Unfortunately we are faced now with the fact that, as a result of the war, many of our important customers are unable to buy from us because they lack acceptable means of payment or are so impoverished that they cannot produce goods for export to Canada and elsewhere to balance their im- ports. This all means, as I have mentioned above, that we have had to finance internally a portion of these exports ourselves or go without a market for them. The destruction which took place in Europe during the war years has left the ples of these countries temporarily in a condition where they cannot achieve complete recov- ery without assistance from the countries abroad that are able to help. Of primary importance is the effective restoration of the production of foodstuffs, i.e., bread grain and other cereals, to assist these people to regain the physical stamina neces- «sary to manufacture and produce 'at least on pre-war levels. The OT essential is the restoration of / manufacturing, and to accomplish this these countries should be equip- ped with adequate machinery to replace that which was destroyed by the wzr. Until they are producing not only for their own needs but also an exportable surplus, temporary assistance will have to be given them, whether by loans or by outright gifts. MARSHALL PLAN There has been proposed, but so far only in broad outline, a plan by Mr. Marshall, the Secretary of State for the United States, which envis- ages rendering aid to the wartorn countries on a basis which will allow them to re-establish their industries and their agricultural production. Sixteen European nations partici- pated in a submission of their requirements under this proposal to the United States and other American countries. While nothing yet has been definitely settled, it is encour- aging that determined efforts are now being made to help these countries to get a fresh start. Canada already has provided sub- stantial aid, and while it has not yet been indicated what part we shall play'in the so-called Marshall Plan, we are in a position to participate to a greater or lesser degree depending to some extent 'on our balance of trade with the United States. Con- off as a result of high prices. Bearing in mind present high prices it is more important than ever that business administration should exer- cise constant and close examination of inventories and accounts receiv- able. Also the relation of sales volume to unit production should be carefully watched; the turnover of goods should be examined in terms of unit as well as dollar volume because under existing conditions the sales volume may be up substantially in comparison to the previous year and thus appear to be satisfactory but unless considered in relation to unit volume the point at which busi- ness turns from a profit into a loss is apt to be obscured. It is important that adequate working capital should be maintained if high prices on the one hand con- tinue and on the other hand to serve as a cushion against the possi- bility of losses which we have seen occur at other times when "out-of- balance" positions have had to be corrected. Earnings should be carefully ana- lyzed with the view to ascertaining the extent of mon-recurting factors which have tended to swell the total. Under present abnormal operating conditions a misconception may develop as to the proportion of actual trading profit that goes to make up the aggregate earnings, The changeg that have taken place in the past year in Canada invite one further comment. It is a well-known fact that, in the course of production, machinery and equipment must be replaced if output 1s to be maintained at a high economic level. If many of the price increases witnessed to-day have an element of permanency about them then ammes for repair, H 14 t and rep t be based on existing rather than on pre-war patterns. CULTIVATE TRADE While I have said that we must be preparéd to assist in ev: way possible in rehabilitation of Europe, including Great Britain, consideration should be given also to cultivating and developing in these countries and elsewhere new markets while we are still engaged in giving direct assistance to some of them. Our potential market is great. While exploring the field for further markets, we must keep close watch on the prices of what we have to sell to ensure that we can compete on a reasonable footing. Our internal policies on wage and material costs must be geared not only to domestic conditions but also in recognition of the fact that we will be in keen competition with other countries both as regards price and quality. In the course of my remarks I have outlined what appears to be the effect of conditions, as we see them to-day, on our trade and commerce. As to the long range view, the Jrogress made at the Geneva Con- erence to set a pattern for freer trade was substantially beyond most expectations. There emerged a series of agreements among the attendin nations covering a wide range o tariff changes which, if carried out to the full intent, will bring about great advancement in world trade, and should berefit Canada materially. It is Tecognized, however, that coun- | tries with 'currently unfavourable | trade positions. may have to emplo; { import regulations and quotas until | this situation is corrected, but with | the working out of the long range plans we may look for a resumption of freér interchange of goods. Although we have many difficult and perplexing problems to be solved, es to pt the restraints which are y ®0 hel build the shattered fabric of European civilization, upon which the main- tenance of world peace itself so manifestly depends. GENERAL MANAGER ADDRESSES MEETING The Annual Statement of the Bank which is Belore you indicates some important changes in comparison with the figures of twelve months ago. In the first place the Bank's holdings of the securities of the Dominion Government maturin, within two s have been red by over $197,000,000. This is Jargely accounted for by the Dominion ernment having paid off their special bank borrowings represented by what were called certificates of deposit. As against this movement bank loans and investments in other than Do- minion Government securities have shown a substantia] increase. LOANS UP $108,000,000 In the year the total of our loans has Pt by $108,800,000, of which $90,000,000 occurred in our commercial loans in Canada. This is a reflection of the i d activity mn business generally. Dominion and Provincial Govern- ment deposits have been reduced by nearly ,000,000. © Deposits not bearing interest are down some $57,800,000, which indicates the quickening of the employment of current funds in larger inventory positions and plant and general uilding operations. Interest-bearing deposits, which are mostly personal Savings accounts, are again quite sharply up and now total $770,000,000, an increase of $73,000,000 in the twelve months. The total of Letters of Credit out- standing shows a sul tial increase, rising from $34,000, a year ago to $46,200,000 at the t time. This movement is an indication of continued trading activity in the export and import field. WIDE INTEREST IN CANADA It was quite evident to senior representatives of the Bank who have visited many countries during the Pt two that there is a contin widespread interest in Canada outside of our own These visits were made for the pur- pose of obtaining first-hand know- edge of post-war conditions abroad and to re-establish banking and trade connections which had been inter- rupted by the war. I am sure that Canada as well as the Bank has benefited by the renewed and mew contacts which have been made by our representatives in various parts of the world. In this connection I would also mention the Bank's Monthly Com- mercial Letter. The major purpose of this publication, first issued in 1915, is to make available information on Canadian affairs which the Bank col- lects from its branches across Canada, together with data from other authori- tative sources. Judging from the many requests which we receive from Government agencies and business and Professions people for copies of our Monthly Letter, it is filling a very useful purpose. This year the earnings available for dividends amounted to $3,201,000 which is $350,000 more than last year. Dividends paid out and provided for, and the extra distribution recently authorized, amount in all to $3,000,000, and $201,108 has been added to the balance at credit of Profit and Loss Account. . Each year there has been a gradual increase in the number of sharehold- ers until we now have some 13,070 shareholders, an increase of about 400 since a year ago. There are now 8,473 shareholders in Canada, 3,244 in the United Kin, sions, 1,173 in the 180 elsewhere. ~ TRIBUTE TO STAFF . The staff of the Bank now numbers just over 7,200, about equally divided as to men and women. This large group is the working force upon whom we depend for the opera. tion of the Bank in the day-to- day transactions. I cannot express too strongly our commendation of the high quality of their services and co-operation. om and posses- nited States, and At this point I should like to make special reference to the Pension Fund of the Bank in relation to the staff. The Fund was started originally some 55 years ago when the staff of the entire Bank was less than the staff of one of our larger branches now. It is interesting to. know that for this lon psi | the staff of this Bank have enjoyed security through the Pension Fund, which is maintained by contributions by the staff themselves augmented by gener- ous assistance from the Bank. [X Co. 1947, King Foss Syaliane, toi. Werld rights asomod | "Cfo see what Junior is 40ing 'And tell him he mustn't." Legion By-Laws Outlaws Commies Secretary States Ottawa, Dec, 9. -- (CP) -- The Calgary Branch of the Canadian Legion, in expelling three: mem- bers of the . Labor-Progressive Party, "was only enforcing a by- law already in existence," J. C. G. Herwig, Legion General Secretary, sald Monday. Disclosing the text of a lejter he went to the Alberta Command in connection © with the = Calgary branch's action, Mr. Herwig quoted a section of the Legion by-laws: "No avowed anarchist, Commun- ist or other person who advocated the destruction of organized gov- ernment in Canada by force shall be permitted to become or remain & member." 'The Jatter added that the Labor- Progressive Party, "according to public statements made by its own leaders, is the Communist Party of Canada." (Terry Levis, G. H. Stark and R. A. Edge all said at a Calgary branch. meeting Nov. 30 that they were members . of the Labor-Pro- gressive Party. They spoke against = motion to ban Labor-Progressive members from the branch. The motion was carride, 230 to 20.) Two Ask $61,063 Over Internment Monteral, Dec. 9.--(CP) --Claims for damages totalling $61,083.75 were contained in two more peti- tions filed in Exchequer Court in Ottawa by Salustre Lavery, K.C,, on behalf of two Montrealers interned during thé war. The petitions bring to eight the total of such claims, sald by Mr. Lavery to be the. forerunners of more than 100 requests from the Montreal! district. He said he had been approached by 32 Cana- foreign origin who had been in- terned. These two claims are in the 'name of Henri Norbert Bernler, a plumber, and Nordoccl Tuccio, a former tramway employee. Bernier is demanding $42563.75 and Tuc- clo $18,500. : They claim that the R.CMUP. raided their homes and arrested them; that they were treated as common prisoners at the Montreal Jail, before being interned without any specific complaint against them, and without their appearing before a legally constituted court of justice. The damages sought are for lost wages, humiliation, loss of pro- perty and hardship to their famil- ies. APPEAL DISMISSED Toronto, Dec. 9--(CP)-- The Ontario Court of Appeal yester- Charles George Martin against his conviction at Port Arthur for murder in the mining shooting of Joseph C. Grant near Schreiber in Northwestern Ontar- io last Dec. 12. Martin, sentenced last Oct. 13 to be hanged Jan. 8, claimed he shot Grant and a man he knew only as "Mike" in self defence, : In Damage Action| dian citizens and 72 persons of. claims | Good Deer Season | In Simcoe County Barrie, Dec. 9.--(CP)--One hun- ter in 10 got his deer in the three- day open season which ended Sat- urday, officials have etsimated. It was estimated that 10 to 15 per cent of the Simcoe County's deer population of 1200 was killed by hunters during the open season on deer. Two hunters -- Cecil Hackett of Stayner and Melville Cole of Utopia --each bagged a wolf while hunt- ing for deer. » Canada ranks second: among the gold-producing countries of the world. Won't Interfere In Jap Sentences UK Tells Canada By ROSS MUNRO Canadian Press Staff Writer Ottawa, Dec, 9.--(CP)--The Bri- tish government ruled it cannot in- aerfere in the commutation of the death sentences handed down to) two Japanese officers for war crimes in the Hong Kong Prisoner- of-war camps where Canadians were held, it was learned Monday. Several months ago the Canadian government asked the British gov- ernment to give reasons for the commutations, made by British military authorities in Hong Kong following the war crimes trials there. Defence Minister Claxton will probably make a formal statement in the Commons this week on this question, giving the details of the reply from London. The two Japanese officers .are Col, Isao Tokunaga, Commandant of all the prison camps in the Hong Kong area, and Capt. Shunkicki Saito, medical officer* for the camps, Tokunaga's death sentence was commuted to life imprison- ment and Saito's to 20 years in prison, Members of the Winnipeg Gren- adiers and the Royal Rifles of Ca- nada from Quebec City, who sur- vived the battle of Hong Kong at the end of 1941, were held in these camps until liberation in 1945. .The negative reply by the Bri- tish on this question was expected, for the government in London has no legal right to alter the decisions of the military authorities, who in matters of this sort are the final tribunal. SIPS HEALULHF Even for double the price you can't buy anything better than' 6 DIE IN FIRE Mansfield, O., Dec. 9.--(AP)--Six members of a family of eight died yesterday in a fire which destroy- ed their apartment. 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