NAURU ISLAND.

Hawera Star, Volume XLVIII, 15 October 1924, Page 7

NAURU ISLAND.

CONTROVERSY ABOUT THE. PHOSPHATE. ' WHEN MARKET TURNS. LONDON, August 27. Mr A. IN. Gray writes from St Leonard’s to the Daily Telegraph, remarking that to everyone engaged in the fertiliser trade phosphate is one of the most important- raw materials. No matter what views one may hold as to the wisdom of the course originally adopted in taking over the Xaimi-Ocean Island deposits, there can be no question that, having become a partner in the tripartite agreement, the United Kingdom must make every effort to’ conserve and maintain unimpaired its right to a 42 per cent, share in the output of phosphate rock from these>~ islands. This course is indicated alike, from the financial, commercial, and political points' of view. “Financially considered, the State has at stake in the islands a capital investment totalling about £1,500,000, amply secured on the property, fchich, as Mr Dickinson points out, consists of about 100,000,000 tons of some of the richest phosphate so far discovered. Commercially considered, the invest--ment is made in a perfectly sound undertaking, seeing that it is paying 6 per cent., and, in addition, is providing each year for amortisation of the capital invested. Politically regarded, the. argument for the retention of the United Kingdom’s share in the property is thought to be unanswerable. Great as are the .resources of the Empire in many of the world’s most important raw materials, we are singularly poor in phosphates; in fact, the Nauru-Ocean Island deposits are, with one exception, the only important accessible beds of phosphate rock within the boundaries of our ‘far-flung Empire. ’ The United Kingdom has, therefore, in the main, to depend upon other countries, in particular France and the United States, for the major portion of her supplies of this vital commodity, a state of affairs which cannot be regarded with equanimity.” Mr Gray recognises that since the Nauru-Ocean Island phosphates passed under the control of the Governments of Australia, New Zealand, , and the United Kingdom in 1920, shipments to this country, relatively speaking, have been small, but lie gives several reasons of a special and temporary nature for this state of affairs.

“In the first place, the. Governments of the three respective countries; including the British Treasury, have insisted on maintaining intact the interest and amortisation payments on the basis originally agreed; in other words they have, doubtless in the interest of taxpayers, taken out the full amounts to which they were entitled under the agreement. ‘lf the property had been a commercial undertaking, it would have had to meet the same conditions as other trading bodies during the past three years, and consequently have had to work probably at a loss, or at best little or no profit. This fact has a. considerable bearing upon the position of the United Kingdom under the agreement, for it is not too much to say that if for' . a year or so the British Treasury had 1 been agreeable to forego its share of the profits and amortisation payments, as a trading body would have done if necessary, the shipments of Nauru-Ocean Island phosphates to this country would hav© been considerable.

‘“Owing to the collapse in the value of the franc, French interests are able to offer phosphates rock from North Africa at very low prices—at levels, indeed, which, relatively speaking, are substantially below -ore-war. In order to meet this position, raisers of American phosphates are selling on terms which must, it is thought, leave them with -a. loss. British agriculture has been enjoying the accidental and purely temporary advantage thus conferred : but it is not difficult to 'foresee that such conditions cannot last for very long, and when the turn in the market comes we shall probabfy find the possession of a substantial interest in Nauru phosphates an inestimable advantage.”