The Evening Star MONDAY, MAY 25, 1936. AUSTRALIAN TRADE.

Evening Star, Issue 22347, 25 May 1936, Page 8

The Evening Star MONDAY, MAY 25, 1936. AUSTRALIAN TRADE.

Drastic changes are announced in Australia’s trade policy. They are intended, in the main, to give preferential treatment to the best customers of the Commonwealth. One of the chief features of the plan is the adoption of the licensing system for a limited range of imports, over which it will* impose higher duties should that course seem desirable. In this way the greatest purchasers of Australian goods will benefit. A further proposal is to prohibit the importation of a large variety of commodities from countries outside the British Empire, except with the consent of the Minister of Customs. The licensing system will exempt all goods o| Empire origin, and licenses will be granted to foreign countries where the balance of trade is not unfavourable to Australia. This also leaves the door open for importation in the case of a shortage of any particular commodity which may occur from various reasons. The announcement made by the Australian

Minister indicates a courageous line of action. This is especially so in the case of Japan, which is so large a buyer of Australian wool. In 1933-34 the imports in the Commonwealth from Japan totalled three and a-half million pounds, while the exports to that country amounted to eleven and a-half million pounds. The trade penetration by Japan, however, has been rapidly increasing. The adaptability of the Japanese industrialists and their enterprise and persistence have resulted in the establishment of efficient factories that are turning out groat quantities of goods in endless variety. The working conditions of the people, the hours of labour—the idea of a forty-hour week docs not sink into their consciousness at all—and the rates of pay are such that articles can be retailed in some lines at prices that seem fantastic for cheapness. Where feasible, concessions are made to the Japanese. There are no restrictions, for instance, on rayon manufactured in that country, and the United States is likely to suffer as a result.

Australia is in a very unfavourable in the matter of its trade with the United States. Its exports to America in 1933-34 were three and a-half million pounds, and its imports eight millions. There is no particular reason why Australia should deal tenderly with the United States. Ever since President M‘Kinley’s day that country has maintained high tariffs against the outside world, some of which are even prohibitive, and added to that, in the case of Australia and New Zealand especially, there is the unfair discrimination occasioned by its one-sided shipping policy. The United States, among other things, will lose almost its entire Australian trade in refrigerating plants and in a wide range of other machinery, and obviously its motor exports will be seriously affected. The balance of trade, according to the 193334 schedule, was strongly in favour of Australia in the cases of France, Belgium, Germany, and Italy, and provided a similar position is maintained those countries, no doubt, will receive reasonable concessions. The Australian proposals have a threefold object, which is to afford further protection to Australia’s secondary industries, which have reached a highly efficient stage in many lines, to give preferential treatment to the Empire as far as is feasible, and to extend concessions to Australia’s best foreign customers. The ideal plan would be to lower tariff walls and stimulate a free flow of trade among the nations. That is outside the bounds of possibility at present, and no reasonable exception can be taken to the proposed tariff changes in Australia. The reaction in London is favourable, and approval is reported in the Commonwealth. America cannot reasonably complain. Japan is the country from which a note of dissatisfaction comes, but in the circumstances an unhindered continuation of her trade penetration methods could hardly be expected.