Page:EB1922 - Volume 31.djvu/88

68 39 countries at the conference Argentina, Armenia, Australia, Austria, Belgium, Brazil, Bulgaria, Canada, China, Czecho- slovakia, Denmark, Esthonia, Finland, France, Germany, Greece, Guatemala, Holland, Hungary, India, Italy, Japan, Latvia, Lithuania, Luxemburg, New Zealand, Norway, Peru, Poland, Portugal, Rumania, the Serb-Croat-Slovene State (Yugoslavia), South Africa, Spain, Sweden, Switzerland, United Kingdom, United States, and Uruguay.

TABLE II. National Taxation per head in 1920, in dollars.

In the Final Report of the Conference (as adopted on Oct. 8), it was pointed out that the effects of the World War had varied immensely according as the various nations had been involved in it. Among the European belligerents, Belgium, Bulgaria, France, Germany, Great Britain, Greece, Italy and Portugal, had become burdened with an enormous volume of debt, internal and external. Their internal debt (converted into American dollars at par) had reached about 155 milliards (thousands of millions of dollars) as compared with about 17 milliards in 1913; and their new external debt was about 13 milliards. Their expenditures had increased by amounts vary- ing between 500 and 1,500 per cent, reaching between 20 and 40 per cent of their national incomes, the highest percentage being shown by France. In spite of attempts to restore their financial equilibrium, in some instances by the imposition of additional taxation, they still showed (with the exception of Great Britain) a large gap between income and expenditure.

TABLE III. The Burden of Debt, 1913-20, in dollars.

They had lost a large proportion of their pre-war gold-holdings and had enormously increased their paper currencies. A number of new states had been created as the result of the war, while some previously existing states had had their territories profoundly modified. These included Armenia, Austria, Czechoslovakia, Esthonia, Finland, Germany, Hungary, Latvia, Lithuania, Poland, Rumania, Serbia and Turkey. In most of them the machinery of an orderly financial system was not yet in operation in 1920.

TABLE IV. Gold Movements, 1913-1919: In Dollars at par of Exchange (000,000's omitted).

In the neutral European countries, including Denmark, Holland, Luxemburg, Norway, Spain, Sweden and Switzerland, financial difficulties were also serious. Heavy expenditure had been incurred owing to the war, and they had had largely to increase their internal debts. This increase in expenditure was mainly due to rise of prices. In some cases it had been met by increased taxation, but Holland, Switzerland and Spain showed considerable budget deficits. During the war their trade balances had been made artificially favourable, owing to demand by the belligerents for their products, and the stoppage of imports; and the resulting accumulation of gold in their banks had led to expansion of currency and a further rise in prices. After the war they had to import goods to replenish stocks, and, owing to the premium on their exchanges as compared with the depreciated currencies of the belligerents, it was difficult to maintain their export trade; thus what would otherwise have seemed favourable factors had become an embarrassment.

It was the countries outside Europe that were most favourably situated economically. Some of them had been able to pay off a large part of their external debts and had even made loans to former creditors. This was particularly the case with the United States of America. But there, too, the accumulations of gold had helped the rise in prices, and the appreciation of exchange rendered more difficult a maintenance of exports, for which the restoration of purchasing power among their European customers was necessary.

In every country of the world, the purchasing power of the national currency had diminished; and the cost of living, as