RECIPROCITY TREATY

Evening Post, Volume CXX, Issue 140, 10 December 1935, Page 8

RECIPROCITY TREATY

CANADA & THE STATES

"MOST FAVOURED NATION"

EFFECTIVE FROM NEW YEAR

(From "The Post's" Representative.) VANCOUVER, Nov. 20.

For the first time in the history of the Dominion a reciprocity treaty has been consummated between Canada and the United States, realising a cherished dream of the Prime Minister, Mr. Mackenzie King. It was his first task since he- was given another lease of power at Ottawa. He was at pains to explain that he would have negotiated with the Motherland but for the fact that the British General Election intervened. The treaty was signed at Washington on the day of the General Election in the Old Country. President Eoosevelt would not complete a treaty with Mr. Bennett, as he was assured that Mr. King, when he went back into power, would grant larger and more numerous reductions in the tariff than Mr. Bennett. There are many who say that Mr. King evinced undue haste in going to Washington, and that he should have gone first to London. • .

The treaty, which goes into effect on January 1, 1936, assures most-favoured-nation treatment as between the two countries—that each will accord the other as low tariff rates as are accorded any other foreign country. It opens up a broader market, especially in products'of the forest, the farm, and the sea. Lumber, minerals, fish, cattle, farm and dairy products, whisky, and some manufactured articles enjoy reductions in tariff ranging to 50 per cent., the maximum Congress authorised the President to grant. While the concessions granted by the United States affect • mainly primary products, those granted by Canada benefit a. wide range of manufactured articles. - ■~ The Empire trade agreements are not disturbed; that is, the most-favoured-nation clause has no relation to the preference granted by Canada to Empire countries. As, however, the tariff is reduced on a large number of articles in which Great Britain and the United States will compete for the Canadian market, it Is to be expected that propinquity to that market will give American manufactures preference ov«r those from the United Kingdom. SOME EFFECTS OF THE TREATY. Canada's : tariff concessions to the United States cover fruit, vegetables, implements of production, textiles of all kinds, cotton^ lineal and silk, clothing of all kinds, footwear, automobiles, radios, electrical' and household appliances, toys, novelties, magazines, newspapers, glass, crockery, electroplate, enamelware, gas engines, gasoline, washing and sewing machines, refrigerators, locomotives, and many other articles. Canada also undertakes to eliminate the practice of fixing values for duty purposes.

The treaty abolishes the tariff on American magazines and periodicals, which ranged up ..to 7Jd per copy, and were imposed by Mr. Bennett in 1931. During the past four years we have seen.the number of English'periodicals largely increased in circulation in Canada and a corresponding reduction in the "pulp" magazines that flooded this country from -across the line. Mr. Bennett's duty doubled the price of certain popular American weeklies; one, with a circulation of 3,000,000, was obliged to open a plant in Canada to earn exemption from the duty.

Already there are protests against the treaty from both countries. Canadian fruit and vegetable growers claim that they cannot . carry on in competition with their competitors across the line, whose industries have been heavily subsidised by President Roosevelt under the New Deal. Canadian automobile makers are opposing the reduction in duty on American cars. On the other hand, trade unions in Pacific Coast States threaten to dump Canadian lumber into the sea and to force a general strike against reduction in the lumber duty by hah. New England fisheries charge that their industry will disappear in competition with Canadian fish.