THE PHILIPPINES.

Auckland Star, Volume LXVI, Issue 227, 25 September 1935, Page 17

THE PHILIPPINES.

JAPAN AND INDEPENDENCE.

AN ECONOMIC PROBLEM,

MANILA (P. 1.), August 19.

Although the forthcoming PhilippineAmerican economic conference which President Roosevelt has promised to call after the Philippine Commonwealth has been inaugurated in November is strengthening Filipino hopes that there can be economic prosperity with political independence, the Japanese angle of the situation is disturbing both to Filipinos and Americans.

Many observers believe the Philippines has only two alternative ways out of tho approaching economic difficulty which is expected to follow Independence. The first is a trade reciprocity botween tho United States and the Philippines. The second is what Governor General Frank Murphy calls "an independence." Both these alternatives, however, appear difficult of attainment in the face of Japan's economic activities in the Philippines. Under a tariff reciprocity, declare, tho main problem will be Japan. The Filipino consumer is so used to buying cheap Japanese goods that a tariff adequate to protect American* r.rticles on the Philippine market will abruptly raise his cost of living to a level at which he will greatly reduce if not altogether stop his buying. On tho other hand, if the United States should givo up tho Philippine market Japan would have it all to itself in 110 time. And with Japan economic king in tho Philippines, the democracy which the United States founded here will be for ever in danger. A Complex Situation.

. Japanese articles generally cost only a third of what the corresponding American commodity sells for. If Japanese articles were dominant in only one or two lines it would not be so bad. But the truth is that Jiymnese articles constitute easily two-thirds of the entire stocks in retail stores all over tho Philippines. It is generally understood that when Murphy said Philippine economics must square off with independence, he had in mind not a continuance of some sort of trade reciprocity between tho United States and the islands, but a greater economic independence of tho Philippines from tho American market. And tho Governor-General will run tho Roosevelt economic conference.

It was Murphy who, while in Washington, urged Roosevelt to announce the calling of the conference simultaneously with the approval of the Philippine constitution under which the commonwealth will be governed. It was Murphy who suggested the organisation of an inter-departmental committee consisting of undcr-secrctaries of departments to study tho Philippine question from every angle. His statoments before this committee, as well as the committee's subsequent findings, will form the basis of tlio American views at the conference. Upon returning to Manila, Murphy organised a similar committee here. It consisted, however, of secretaries of departments and was supported by a group of technical men in and outside of the Government. This committee is now studying the Philippine side for presentation at the conference. Does the Flag Follow Trade?

As Murphy seems to be the brains of the conference, and as the conference may bo held in Manila, it is expected that he will exert a tremendous influence on its deliberations and recommendations. If this is true, then it is reasonable to expect that he will urge "an economics that will square off with independence." Whatover may bo the other features of this new economics, it is certain that it will try to correct tho almost absolute dependence of Philippine exports upon tho American market. If tariff reciprocity is discarded, then the motive for protecting the local market against Japanese goods is also eliminated. And an unprotected market will surely mean a great impetus in the economic penetration of the islands of Japan. Japan, it is declared, will have acquired complete economic dominance in the Philippines by the time the commonwealth ends and the republic is to begin. Does tho Japanese flag follow Japanese trade? This is the great question of the moment in Philippine-Ameri-can nelations.