NO COTTON GOODS

Evening Post, Volume CXXVI, Issue 77, 28 September 1938, Page 11

NO COTTON GOODS

FOR JAPANESE HOMES

NEW GOVERNMENT DECREE

Recently there occurred one of the most remarkable events in the history of the world cotton industry, says fiie "Manchester Guardian." The largest cotton-manufacturing country, by a stroke of its Government's pen, decided that its people should cease to wear and use cotton goods and should substitute the synthetic material, rayon, in the form of staple fibre. The whole of the production of the mills, apart from military requirements, is to be for export. This is only the latest Stage in Japan's efforts to carry on & great war without losing her export trade and her means of obtaining foreign exchange to pay for her munitions. It is, of course, a revolution for Japan herself, for she is a great consumer of cotton goods, and about 40 per cent, of the products of her mills have hitherto been used at home. Now this is to go. The consumer is not pleased, a small matter in a totalitarian State in war-time. For although the Japanese have made great advances in the manufacture of staple fibre it is still to the ordinary man and woman no adequate substitute for cotton. The measure involves pretty complete State control and its effects on the small manufacturers and middlemen will be serious; the big firms will benefit and prosper. The Government has promised to give the sufferers relief and to help them to turn over to export goods and to war supply industries, but even the most patriotic Japanese newspapers admit that the dislocation is bound to be severe. REDUCING HER IMPORTS. From the beginning the Japanese Government has aimed at reducing the ©mount of cotton imported while doing everything it can to maintain exports. Its first step was to decree that 70 per. cent, of the cotton- goods produced should be used for export and that the remaining 30 per cent, should be of mixed cotton and staple, fibre. A quota system for the import of raw cotton worked badly because industry could not foresee what future quotas would be;. there was. intense speculation,, and. price control broke down. An attempt to divide the market into domestic and foreign led to the domestic markets being flooded by goods intended for export and to a rise in all prices. Then came more elaborate price control, and instead of allowing trade committees to fix prices (disregarded in practice) the Government stepped in to .enforce its own decrees. But all these efforts have been insufficient' to' keep up the volume of exports. Now raw cotton imports are to be "linked" with exports and the domestic' market ceases to count jn cotton Rayon control is. also on the way. What changes are to be introduced in the exporting mechanism is a-little obscure; There is to be what is officially: called "compulsory freedom -of competition for the export trade" (whatever that may be), but it will be surprising if the effect •is not soon felt in world markets. Japan has at her command a means of subsidising exports, and although her policy will naturally be to get the highest price she can it cannot be foreSeen to what straits she may be re-. duced. At best the influence of an export drive by a country :whose, ecoiiomic state is so precanbtfs! "musftfbe disturbing. '