EMPIRE TRADING

Greymouth Evening Star, 29 July 1932, Page 7

EMPIRE TRADING

MR. BALDWIN’S REPLY TO OVERSEAS “DEMANDS.” [BY CABLE —PRESS ASSN. —COPYRIGHT.] (Received July 29, 10 a.m.) OTTAWA, July 28. Mr. Baldwin issued an important statement to the Conference defining Britain’s attitude toward reciprocal preferences. He said: “The British delegation has no intention of weighing meticulously, benefits given or received, but is anxious that the outside world shall realise the spirit animating’ us all, and which has been constantly and consistently displayed in our actual dealings *with the Dominions. Any suggestion that Britain has been backward in developing or assisting Dominion trade, or not fully reciprocating Dominion concessions in the letter and spirit, is wholly unwarranted. The British delegation, appreciating fully the advantages received in Empire markets, entered the Conference with the intention of making a full contribution to the still further extension of Empire trade. We have stated frankly and fully to the Dominions, the articles on which we desire further advantages in Dominion markets. We will welcome an equally full statement of the corresponding advantages the Dominions seek in Britain’s market. The British delegation will examine these sfafements, as received, with unprejudiced mind, and an earnest desire to give effect to the Dominions’ wishes. We are convinced that our own views will, in turn, be given equally favourable consideration.” We desire to draw attention to the favourable tariff treatment Britain accorded to Dominion imports which compete with United Kingdom products. The certainty of outlook is also important in trade. It is essential that the manufacturer* and importer shall be able to assess, with reasonable assurance the cost of an article to the consumer. Any arbitrary uncertain impositions especially where the executive has discretion to” determine duties, cannot fail to restrict, and even prevent business. We desire also to emphasise to our Dominion colleagues that Britain is so highly industrialised that it is vital to the physical existence of her people to find adequate markets for her products. Actually more than half Britain’s exports go to foreign countries. Britain has 21 million unemployed. Anything tending to check Britain’s foreign exports must lessen her peoples’ purchasing, and swing power thus damaging the markets on which the Dominions largely depend for consumption of their products. WHAT BRITAIN HAS DONE. . The foregoing tables show, firstly, Britain doing her share in encouraging Dominions’ trade and industry. ' Secondly, Britain takes a very large proportion of Dominion exports for many of which there would seem to be no other available world outlet.

Thirdly, Britain has consistently facilitated the entry of these Dominion products on., the best possible terms, and with the least -possible interference by Government policy 01 customs administration.

Fourthly, Britain has been eager to give the Dominions extensive preference wherever she has found it possible to impose tariff. Fifthly, Britain thus helped the Dominions to build up substantial favourable visible trade balance. It is a source of legitimate satisfaction that the preferential access to British investment market, which resulted from close association between Britain and the Dominions has played an important part in the development ox 3 Dominion resources. Showing the extent this factor has operated, it was estimated that 3800 millions out of British capital invested overseas before the war, was placed in Empire countries. Although necessarily there has been a diminution in the flow of Oversea investment since the war, the proportion allotted to Empire ' countries has substantially increased. Out of a total of 1401 millions invested between 1919 and 1931, no less than 848 million, has been placed in Empire countries. Mr Baldwin’s memorandum, every word of which obviously had had the weightiest consideration is interpreted as Britain’s intimation to the Dominions, that “demands” at the- conference must not be all on their side. The Dominions are taking especial notice of that part! of the statement which says “there is practically no free entry of British exports info the four principal Dominions,” hinting that the present scale of preferences is insufficient for British viewpoint. The publication of such views instead of merely the enunciation of them in the privacy of the conference is regarded as a mild indication to the Dominions that the British delegates are slightly piqued at the forcefulness of the Dominions’ demands, coming like an encircling attack. Moreover, the eyes of the British people are focussed on Ottawa, therefore the British delegation must walk warily, knowing assent to anything in the nature of food taxes would cause a tremendous reaction in Britain. The statement is regarded as the most vital pronouncement since the conference met at Ottawa. Mr Baldwin quoted a table of Britain’s retained impdrts> 1930, from Australia. Dutiable, before December, 1931, £4,660,000, representing 12 per cent. Dutiable under Import Duties Act or Horticultural Products Act, £ 13,500,000, representing 34.6 per cent. Not subject to duty, £20,820,000, representing 53.4 per cent. From New Zealand, dutiable before December, 1931, £BO,OOO, representing 0.2 per cent. Dutiable under Import Duties Act or Horticultural Products Act, £20,280,000, representing 53 per cent. Not subject to duty £19,930,000, representing 49.5 per cent. He pointed out that the proportion of imports from the Dominions enjoying free entry exceeded 90 per cent. Only British Indian imports were appreciably below. Since Britain’s change in fiscal policy, only 30 per cent, of her foreign imports had been admitted free. BRITAIN’S EXPORTS. Mr Baldwin continued’: Regarding British exports to the four principal Dominions, there is to-day practically no free entry. Most preferences granted by Britain are total remission of the duty payable by foreign goods The following table shows the Dominion imjiorts to 1930: —

Ausaralia, from all sources £129,220000; from the -United Kingdom, £54,241,000, from other British countries, £15,509,000. From foreign conn-

tries £59,470,000. New Zealand, from all sources £42,663,000. From the United Kingdom £20,223,000. From other British countries £9,007,000. From foreign countries £13,433,000. The following figures (all millions sterling) include bullion coin, also include re-exports. ' Britain’s imports, 1930:—From Canada, 38.7; from Australia, 70.5; from New Zealand, 44.9; from South Africa, 62.1; from the Free State, 43.1; from Newfoundland, 2.2; from India, 52; from Rhodesia, 2.3; total 315.8. Britain’s exports, 1930, to Canada, 31.3; to Australia, 33; to New Zealand, 18.7; to South Africa, 27.7; to the Free State, 44.3; to Newfoundland, 0.9; to India, 61.6; to Rhodesia, 2.6 Total 220.1. Visible balances (plus ' means favourable): — Canada, plus 7.4; Australia, plus 37.5; New Zealand, pus 26.2; South Africa, plus 34.4; Free State, minus 1.2; Newfoundland, plus 1.3; India, minus 1.6; Rhodesia, minus 0.3. Total visible balances in favour of the Dominions 95.7.

These figures reveal two noteworthy points. Firstly, the visible trade balance in favour of the Dominions is nearly a hundred millions sterling. Secondly, the Dominion imports from foreign countries amounted to nearly 350 millions. It is necessary to remember that the percentage duty,is of great importance in assessing the value of preference. If it is to give material assistance, preference must not be so high as seriously to restrict importation. The British delegaton urges upon the Dominions that the rates of duty should be so graduated as to give the British products a reasonable chance of competing on even terms. Also the duties against British products should be fixed for a protective purpose, no higher than is necessary to give a fair chance to a reasonably efficient Dominion indusitry.

MR BRUCE SILENT.

(Recd. July 29, 1 p.m.) OTTAWA, July 28.

Mr Bruce declines to comment on Mr Baldwin’s memorandum. He may make a considered statement later.

The impression here is that Mr Baldwin’s statement is tantamount to an open letter to Mr Bruce, who is unwilling to reply because that might suggest a semblance of disagreement, which does not exist on the main question of reciprocal preferences.

Opinion among Australians is that Mr Baldwin’s statement leaves unanswered Mr Bruce’s point that the Import Duties Act last March was a ‘tardy” recognition of concessions which Australia and the other Dominions had made to Britain for many years. It is pointed out that before March, Australia received a preference of only 12 pei* centum of her exports into Britain. The Import Dut ies Act raised the percentage to 46.6.

If Britain had been faced with the position six months ago, she could hardly have said she was giving a reasonable measure of reciprocity in return for what Australia had long granted amounting to seven millions sterling yearly in prosperous times. CURRENCY COMMITTEE. There was a full discussion of Dominion problems before the Stevens Currency *. Committee. Mr Bruce lengthily outlined what the fall in prices meant to Australia, involving drastic wage cuts interest reductions. So successful had been Australia’s efforts that notwithstanding the world prices, she had increased production by one-third. It had been necessary to reduce imports by three-quarters. Even then, Australia had only just squeezed through, and was meeting obligations with utmost difficulty. He said: Unless prices increase it is impossible to see how Australia can carry on. Having made all these sacrifices, the Commonwealth cannot continue further drastic reductions. We simply must get relief by increased prices. Mr Bruce pressed strongly the view that aetion was essential, pointing oufe it now required ’ double the value of exports to meet external obligations. He emphasised that unless exchanges were stable obviously reciprocal preferences could be wiped out overnight by exchange fluctuation. Mr Chamberlain spoke on behalf of Britain, but the defete was only in the preliminary stage, and the matter will again be secretly discussed tomorrow. ♦

Mr. Havenga and other Dominion Ministers presented’ Empire fruit proposals to Mr. Runciman, Sir J. Gilmour and Sir P. Cunliffe-Lister. The sub-committee on Industrial Standardisation, elected as chairman, Doctor N. M. Tory, President of the National Research Council of Canada. It aims at co-ordinating industrial specifications throughout the Empire, and has already discussed timber chemicals and agricultural machinery. ’ Doctor Craig (New Zealand) was elected chairman of the Customs Administration Sub-committee. An official verbal communique stated: “The discussion chiefly concerned valuation for duty purposes, with a view to gaining uniformity.” Two hundred newspapermen burst into laughter at the mcagreness of the announcement, which typically was noninformative in accordance with the offficial policy s towards the world’s Press.

ANGLO-CANADIAN CONCORD.

[BRITISH OFFICIAL WIRELESS.]

RUGBY, July 28.

A private meeting took place at the Ottawa Conference between the United Kingdom and Canadian Ministers Mr Bennett enumerated the primary products for which Canada desire? preference in United Kingdom market Wheat is not now expected to play a serious part, but Canada attaches great importance to the import of live cattle and bacon. Mr Bennett further stressed the needs of Canadian lumber, base metals, tobacco, and canned fish. Ho also gave an outline of the con cessions Canada was willing to make, which includes a free list for the whole Empire of non-competitive articles, and proposals to reduce duties on other articles, in such a way as would produce fair competition in the Canadian market. The exchange of views was altogether frank and friendly, and the meeting is considered as a valuable step towards a general agreement. MEAT PREFERENCE PROPOSALS. OTTAWA, July 28. The unanimous Empire-meat proposals, presented to the British delegation, are exactly as cabled earlier, with the inclusion of bacon, on the same terms as pork. Bacon became an important topic for discussion by Dominion delegates at Ottawa, because while the Dominions are not greatly interested in this i product, their support of tariff plus