BRITISH TRADE IN A EUROPEAN WAR.

Dominion, Volume 7, Issue 2219, 4 August 1914, Page 7

BRITISH TRADE IN A EUROPEAN WAR.

* SIGNIFICANT FIGURES. FIRST FEW WEEKS THE MOST VITAL. What would happen to Britain's ex- 1 port trade in a great European war? The Liverpool Shipowners' Association recently pointed out that it has rio -,'". means of estimating the risks of cap- ' tiire to which our oversea trade would "be subject in time of war,-but it is possible to estimate, approximately,' the , .;', • valno of the property that would bo at ... .risk. • For the purpose of the following .'■'.■ estimate's tho year 1911 has been taken,, as during that;year tho values of both' ';. : shipping and commodities , were / far below the values of 1912, and the figures for':l9l3 are not yet available.

'."/;. Interesting Figures. ..,". In 1911 there were. 4102' British steamships, of a tonnage of about . '15,774,000 tons; gross, employed in •foreign trade. There were, in addition, '•'about 500,000 tons of British sailing •-..-. 6hip tonnage employed ■ in 'the" same trade, but as the carrying capacity, of that tonnage is less than the oarrying , capacity.'of 163,000 tons of steam 'shipping, the sailing 6hip tonnage may be ', treated as a negligible quantity. The -.-' average, age of the Britisn ■. steam tonnage was eight years, and its value.may be taken at-£127;000,000. In; these values the 'liner tonnage has been taken ' at £10 per ton gross, and thatof '.the -..-': general trader tonnage at £4 10s '. per ■ ton dead-weight carrying capacity.:, It is not possible to estimate the total . yahro of the cargoes carried by the '.'■■'•.above tonnage ih : the general trade of the world, but it is-possible to estimate •both the value of the British tonnage employed in foreign Voyages .to' and from ports in the United Kingdom and Of the cargoes carried on such voyages. i In 1311_there were about ,2350 British '.-';■ ; steamships ebrployed in . snob. trades, and their value was about £80,000,000. The.valno of the cargoes^'carried by . those Vessels during 1911' was about ,£927,000,000.: 'Each of'. these -vessels 'made, oh the average., 10, voyages in the year; that is, counting each:voyage in and each Voyage out as a separate voyage. The average value of the'23so ■ : British" steamships which were employed ; in 1811. in foreign tOTages to'.andfrorh | ports in the 'United Kingdom .was there-, " : fore about £34,000* and, the. average" .value of the cargoes:carried by. iiioh.j ships on each Of eu6h voyages was about £40,000. ,-..:. \., ■:■.,■ W" -.'■;. Calculated Loss, ' .;-',lf it be assumMthat in a:naVal war. we lost 10 per.cent, of- -otir. mercantile theiotal loss 6n foreign voyisges made by British ships to and from porta: in .the United Kingdom would represent £8,000,000 in ships and • £9,400,000 in . cargoes; together, £17,400,000. ' If; those'losses; were spread oyer' six ■ ■:• months, th'ey would be covered'by an ' insurance premium at the rate of 2 per cent, per "voyage on the values of the ' ships employed and the cargoes.carried., Ibis, assuniedjloss is an extravagant one, as it is' iricohceivable that.ihljsix months we should lose 235.ocean-going steamships, but the .assumption has been made to show .that'oh any reasdnablo assumption the risk is one that can be covered by insurance, arid: at ,a. • reasdruibla rate: : The insurance premiums on.the ships would ultimately fall' on • the cargoes/ as the .freights , would be advanced :to. cover those premiums j.^and-itha'ltotal?cost of ■■ insuring both the ships' and; tha- cargoes would ultimately merge in thd.prioes at which the cargoes were sold. .But : the' ; -total charge, -eveo on the'assumed loss' of 10 per ceht.> would represent less' -." than,4.per cerit.en the total value: of 'the cargoes carried during the . eix months; aVcharge wnioh could , not ; materially affect the price of, food or /of raw material,or oripple the,oversea ■ • -trade of the country: ' , ; v -' •'.- ;i"Mr..;Stewart, li.' ! - Murray, 'in 'the ...t'Nirieteenth' Century", magazine, "thud .' presents the essential Constituents'-of -•■' the matter:—:' .; v ... ■ ■"' : \ '^ ia f nano ' a l confusion, and even perhaps the breakdown of the international system of credit; due to the powers'of the"-World. , '(except the United States) being simultaneously Engaged in war. ' A'bankihg panic may well follow, and probably will. It is well known that our gold ■ .. reseryo. varying from 3i .to 44'' per cent, of deposits, is quite insufficient to • 'meet ,suoh a strain, as has often bien stated by leading banking'.authorities'. As Sir Robert Giffen put it, in 1908, "The Conclusion, then is that:-the barik- •'■• wg position' is one of- real v danger in ( . .event of a great war." Arid >'on'the ■ . nature and effects of a great barking ;■ panic there is no need to enlarge! Apart I from tho miseries resulting to .'deposit-■ ; ors and _ shareholders who are suddenly ■ impoverished, there is no htoro potent ." ? aus , e ,, of arid . unemployment." In the April number cf this Review, I suggested that a joint Treas- • . ury and Bankers'; Committee should boappointed to consider .'bow best 4o fortify our credit-system for'war and to : prepare an '-'to- be .' '■- Pos.ited__.with the ■ Committee of- Ifn- -„ penal/Defence till required.'' .,•'.•.-,-. • • 2 - jThe.'second. great danger to be guarded against is the interrnptioh- of pur over-sea supplies ■of fdod and raw ifiaterijl by fear of. capture 'or''sink-I . ing. Owing to recent alterations ;in ~ our, naval strength relative -.to other y Powers, and especially; Germany,, it is admitted that /during the -first few ' ', of war our commence will have ■ . 'te look practically after itself. And any ■ day wo .have about 6000. ■■ vwsels scat-' ', tered over 100 000 miles of <--xpJsed • "aao iputes, .ships and cargoes worth about £200,000,000. Under.W «Z dl ? 10 " s . I war ,insurance rates will rise to -. prohibitive heights and the klow tramps ; , -many of -them at.!cost-that bring the majority of our will lie up .-. m port through fear of capture' or sink- ; ing, Our trade will thus be intermpted, and a large part of our -working classes -will be thrown out -of ;, or k This will intensify-the banking panic' the commercial confusion, and the food-' ; supply difficulty. y-r"*-?. Tho third.great danger is that the f> r price of food m. war timo will rise to ( .'famine heights," as stated ty the • w J t o e "e s bofore the Royal Commission , . of 1903. We have about 7,000,000 men, ;•;■ women, and children in normal poverty ;<; in our great cities'who could not pay such a price, to whom must he added , :■• another 2,000,000 or 3,000,000 rr.(;re for ; those thrown out of work wholly or '-.• -partially by the war. making about 10,000,000 souls in all who v. ill not bo >_ f'''' 0 P a J ne famino war price for ' food. Soon after-the-opening'of war this vast multitude will begin to pour '.'■ on to'the rates. The guardians of the 1 poor aro, accustomod to deal with 2\ per cent, of the population—they-will havo to deal with 30 for cent. Th'is can be done if, and only if, a suitable organisation be arranged beforehand. Such an organisation can bo arranged.' Before the Royal Commission on Raw Materials and Food. Supply I gave an, outline of such a one, approved by the i' £ ouncll «f the Associated Giardiars of .; England and Wales. Failing. such organisation we must expect civil tumults, which will intensify tho banking panic and commercial and industrial confuBlon - Tha explosive forces of disorder underlying every modorn democracy must be most carefully considered and guarded against. From the strikes of, recent years we havo learned that, even if wo did not know it before. Also tho political organisation cf the working classes is inow. so powerful that, if the hardships of European war should prove . too intelerable, they will be able-to - press Jpx.. peace and submission to our •: ioea with political power-not easy to

resist. The most critical period will bo during the first few weeks following the opening of war, boforo wo have had time to adjust;■ ourselves to the new war conditions. Everything will then depend-upoii tho_ ■promptitude, and efficiency with .which remedial measures arb brought into operation to minimise panic and. restoro confidence.

BRITAIN'S POSITION.

NATURE OF THE MTENTE.

MUST PROTECT BELGIUM.

"As has been repeatedly stated, this country-is not 'under any obligation wuich\ compels"it 'to take part in any' war."—Mr. Asquith, Prime Minister, in ' Parliament March/J913.""-. "Our policy has not_ been to make- more secret treaties, but we have done something to publish treaties that were secret • before. . ... Wo have. avoided making secret treaties that entail serious obligations' oh. this country."—Sir Edward Grev, Foreign Secretary, in Parliament,' May, 1913.

These, two statements put the position, of Great Britain in concise form. There have been agitations from time to time that the Triple Entente, should be converted into an Alliance, but th'is has never been-done; friendship with France and Russia is based on the Anglo-French Convention of 1904 and the Anglo-Russian Convention of 1907. Both these conventions provide for the settlement of certain specific disputes .is to territory. The AhgloE'rencli; Convention was made by the last Unionist Government, and contained secret clauses' relating to Egypt and Morocco.'.: These were pub-> lis'hed in 1911, and Sir Edward. Grey then stated definitely that in connection with the Anglo-French Convention "there are no other secret .engage-, mehts." The Anglo-Russian Conven-' tion was' made by the present Government and the declaration of Sir Edward Grey at the head of this article is an unequivocal statement that there are at ahyrdte no secret clauses of any moment in it. "

: As Britain is a party to guaranteeinp; the. territorial integrity of Belgium, Liixoinbufg, Switzerland,; arid Norway, ''these'.States: could therefore.claim her intervention should ' warjike operations be coriduoted.iri their territory by any nation. When the, neutrality, of, Belgium was threatened during.the FrancoPrussian, war Britain took prompt steps to protect it, and undertook to do so by force if necessary.' The; result was that Belgian: neutrality' was .respected without the employment of any force by Britain. : In the discussion (of the' Moroccan, crisis in Parliament in 1911, Eir Edward Grey referred in detail to the relations of Britain with France and Russia, and.said:—' ~ '-'.'. ..'.-.'''. :, "Any._support,that wi would give France or Riiss'ia in times Or trouble would depend entirely'upon the feeling of and publio opinion here when the trouble . .tame." '• ■.'•.. ' Sir' Edward Grey-also said:' "There' iS one foreign policy i different from che-ohe I have v bee/i endeavouring te iketoh to the House, It seems, to be •advocated in some quaTters in this cotintfyj arid'it appeats to the to oe dimply disastrous. It is that we should •give it: to be understood that in no circumstances,' however aggressively, provocatively,'or wantorily a friend- of ours ivas attacked,,should we give. our friend any assistance whatever. That would be ah attempt to. revert "to .what was once called a policy of 'splendid isolatiori;' MiwOuldAde'priyeT.U-scof'illlie pos-» sibility of having a friend in Europe- 1 - (Opposition ,cheers)-^and. it w;ould re-, suit .in the nations,-, of'■-, Europe—the. Other nations -of.. 'Europe—either , by choice or by necessity'' being brought ■ Into the orbit: of a single .diplomacy from whioh we should, be excluded. ; ;■:■'.-.' That ; policy is not a possible orie.now." ''■' • ! ' One.of the most recent official stateraerifa:.6n" the .relations of the three Po.wers of the Entente was made in the official Commuhiquo issued after the King's visit to Paris in Aprillast. It ran as follows: — ■ "In the course of the •conversations which have been carried ,ori between Sir Edward Grey land M. DOumerg'ue on the occasion Of the visit of Their Majesties the,.King and ,Queen tt Paris, ; the vdrioiis questions interesting the two countries have been considered,' dud tho'ideiitity ! of the; views of ..this ."two Ministers on all points has been established, regard being paid to the results 'of the polioy pursued by:the two Governments in association:.with the Imperial Russian' Government/ Sir EdWard, Grey arid M. Doumerguo are in complete agreement ad 'the, necessity of the three Powers .'cdritihumg their con«tant efforts .with a view'' of the maintenance'of the balance of power and of' peace." ." .-', '■'■ ■- ""•..