A GERMAN THREAT

Evening Post, Volume CXXV, Issue 151, 29 June 1938, Page 13

A GERMAN THREAT

STARVING OUT CZECHS

DIFFICULT TO CARRY OUT

TRADE EXAMINED

The reports of the recent AngloFrench conversations in London referred more tj?«in once to a Fr-puch memorandum on "the economic strangulation of Czechoslovakia," says a writer in the "Manchester Guardian." It is worth examining the argument that the Anschluss has placed Czechoslovakia economically, at Germany's mercy. Germany's capacity to starve Czechoslovakia must ultimately depend on the extent to which Czechoslovakia is selfsufficient in foodstuffs. Since the war, thanks to a policy of intensive agrarian protection which contrasts somewhat unfavourably with her advocacy of Danubian economic cooperation, Czechoslovakia has reduced her dependence upon imports of foodstuffs to a remarkable degree. The volume of her imports of farm products fell by 75 per cent, between 1928 and 1935. As regards cereals, she had in 1936 small export surpluses of wheat, barley, and oats, and sufficient rye, although she still had to import approximately 25 per cent, of her maize. She was also more or less self-sufficient in potatoes, vegetables, and dairy. products, whilst she remained a leading world exporter of beet sugar and hops. FOREIGN FERTILISERS. As regards meat, she had sufficient cattle, but was still very dependent upon imports of pigs and pig products. She had also to import most of her fruit and vegetable oils. Even more important, she remained a large importer of fertilisers. In fact, pigs, fruit, vegetable oils, and maize are her only key imports of food and feeding-stuffs. In other respects she is approximately self-sufficient, given good harvests and adequate imports of fertilisers. To judge by the statistics, therefore, it should at least be a.difficult matter to starve Czechoslovakia. But in practice it might be possible to cause considerable physical suffering by disorganising her economic system through on economic blockade. The success of such a policy would depend on four main factors: firstly, the extent to which Czechoslovakia depends on imported raw materials; secondly, the extent to which her productive system depends on export markets; thirdly, the proportion of her foreign trade which is normally conducted with Germany (including Austria) and Germany's potential collaborators in a policy of blockade; finally, and most important, the proportion of her trade with other countries which must pass through Germany and Germany's potential allies. INDIGENOUS RESOURCES. By comparison with many other industrial countries, Czechoslovakia is well supplied with indigenous resources. She is a large exporter of timber. She has also more than enough brown, though little black, coal, and can supply more than half her own requirements of iron ore. She produces' some manganese, lead, and other minerals, but these are not sufficient to meet all her needs. She is also a large importer of mineral oils, raw cotton, and wool. Czechoslovakia was . recently described by the British Commercial Secretary in Prague as "one of the world's most strongly marked exporting countries." Some years ago it was calculated that approximately 30 per cent, of her home production was exported. This was not so high a proportion as in the case of Belgium 'and Denmark (51 per cent-.), and certain other small countries. But it was higher than in the case of Great Britain (25 per cent.), France (24 per cent.), and Germany (23 per cent.), and far higher than in the case of the United tSates (7 per cent.) and the U.S.S.R. (4 per cent). Moreover, for certain Czechoslovak industries the proportion of total output exported is particularly high, being over 50 per cent, for sugar, glass, and paper, and over 70 per cent, for textiles, agricultural machinery, and enamel-ware. THE GERMAN MARKET. Germany is Czechoslovakia's largest market and source of supply. It is, nevertheless, easy to exaggerate the economic importance of "Grossdeutschland" to Czechoslovakia. Czechoslovakia has deliberately developed her trade with the United States and Great Britain, which have the secojjd and third largest shares in her foreign trade, whilst her trade with Germany and Austria has fallen abruptly. In 1922 "Grossdeutschland" supplied 36 per cent, of Czechoslovakia's imports and took 41 per cent, of her exports.. But in 1937 the proportions were 19 per cent, and 21 per cent, respectively. One-fifth of a nation's foreign trade is an important but not necessarily a decisive part. In 1906-10 Serbia successfully defied an economic boycott by Austria-Hungary, who normally took over 80 per cent, of her exports, by developing markets in Germany and elsewhere. On the other hand, it is of course clear that certain Czechoslovak industries (and notably those in the German-speaking areas) could be exceptionally hard hit. Germany takes the greater part of Czechoslovakia's timber exports, whilst she and Austria together take practically all her coal. Incidentally the Austrian market for Czechoslovak coal will presumably be lost to the Ruhr in any case. But a German economic offensive would cut both ways; certain German interests would be bound to suffer from retaliatory Czech measures. GERMANY'S WEAPON. The argument that, reinforced with the help of Hungary anjJ Poland, Germany could have Czechoslovakia at her mercy ignores the fact that, thanss to a protracted trade war with Hungary, only 2 per cent, of Czechoslovakia's exports are taken by that country, •whilst the Polish share is equally small. The one really formidable weapon in /Germany's hands is, therefore, the fact that Czechoslovakia is a landlocked country. All her trade must pass through one of her neighbours—Germany (including Austria), Hungary, Poland, or Rumania—and the bulk of it does, in fact, pass through Germany (to Hamburg) or Austria (to Trieste). Germany is, therefore, in a position to block Czechoslovak trade with the Outside world by charging prohibitive rates for transit traffic. There is already talk of Germany's raising the Adriatic tariff on Czechoslovak goods passing to or from Trieste. The natural result of such a policy would be a diversion of trade through Hungary (Fiume or Trieste), Poland (Gdynia or Danzig), and Rumania (Constanza and ihe Black Sea ports). In order to achieve success, therefore, Germany would need to secure the co-operation of at least Hungary and Poland in a policy of strangulation. The co-opera-tion of Rumania would be less essential, since the extra distance involved in that route would in most cases prove prohibitively expensive. So far from Germany's securing such cooperation, however, it is reported that Poland has actually offered Czechoslovakia assistance in diverting her trade through Gdynia.