Meeting Unfair Competition

Manawatu Times, Volume LIX, Issue 7508, 5 July 1934, Page 7

Meeting Unfair Competition

Aid to British Shipping

MR RUNCIMAN’S SCHEME (British Official Wireless.) EUGBV, July 3. An important statement regarding the position of tho British mercantile marine was made by the president of tho Board of Trade (Mr. Eunciman) in the House of Commons to-day. lie said that the fundamental difficulties not only of British, but of all shipping at X>reseut, were tho reduction in the seaborne trado since 1929, aud the striking increaso in the mercantile marines •of the world since the war. Seaborne trade had fallen since 1929 by onethird, and was less than in 1913. On the other hand, merchant skipping had increased by about GO per. cent, since 1914. The results were seen in depressed international freight markets and in the balanco-shects of shipping companies. Tramp freights stood at about three-quarters of the 1913 figure, although tho running costs were greatly increased. While liner freights, owing to the conference system, stood at relatively higher figures, many liners were running with empty space. In the result cargoes were being carried on an unremunerative basis with disastrous results to ship owners. Very few British shipping companies were covering their running expenses, and fewer still were able to make necessary provision for replacing their ships as they became out of date. Whole Nation Affected.

This was not only a shipowners’ problem, but concerned, in particular, ships’ officers, engineers, and seamen, as well as the nation as a whole. If this stato of affairs were due to fair competition it might be held that the British mercantile marine ought to fight its own battles, as in tho past, without Government aid. But this was not .the case. The increase in the mercantile marines of some other countries had been due in large part to the stimulus of subsidies and that financial help was still being given by many foreign countries. Other countries were, of course, free to adopt what policy they thought fit, but from tlio point of view of the British mercantile marine the competition created and maintained by Government subsidy could not be regarded as fair competition and British shipowners were entitled to seek tho help of their Government if they were not able successfully to defend theraslves. - Direction Of Effort. The'efforts of the British Government wero primarily directed to an increase of international trade. But the revival of world trade might be slow. Passenger and cargo liners were suffering from the falling off in world trado and from subsidised foreign competition. On the other hand, by means of their conference arrangements, they were able, to a certain extent, to protect themselves, although it might be necessary for special - measures to be taken by the Government in particular trades. The, bulk of the tanker ton nage was in the hands of tho big oiltrading companies, and this class of tonnage had inaugurated an international plan for adjusting supply to demand. The position of coasting and near sea trades raised considerations somewhat different from those applying to ocean-going, shipping, and no special measures in respect of these trades were proposed at present. Assisting Tramps.

As to tramps, the Government was prepared to ask the House to grant for vessels carrying tramp cargoes under tramp conditions a subsidy to be used for defensive purposes, and to cost no more than £2,000,000. This subsidy would be aimed at securing the abolition of foreign subsidies and the greater employment of British shipping and of seafaring classes. Such defensive subsidy could be given only on condition that shipowners formulated a scheme satisfactory to the Government. Such a scheme must prevent as far as possible the subsidy being dissipated by domestic competition of British ships carrying tramp cargoes and ensure that it was effectively directed to securing greater employment of British tramp shipping at the expense of foreign subsidised shipping. That entailed a real measure of organisation of tramp shipping. Such a subsidy would be given for one year only, and within that period be subjected to witnclrawal, if the circumstances which led to its introduction were altered. Pressure Abroad. It would also bo a condition that ship owners, through their international organisations and in other ways open to them, should press upon shipowners in other maritime countries the framing of proposals tending to adjust the supply of tonnage in the world to the demand and thus to raise freight rates once more to a remunerative level. The Government would continue their efforts to secure an. international consideration of means to place shipping generally on an economic footing, and intended to communicate with foreign eountries to ascertain their views on the possibility of international measures to facilitate the abolition or reduction of subsidies and the formulating of schemes for the laying up or scrapping of superfluous tonnage, or both. The task of preparing the ground for and of formulating stich schemes must, In the first instance, fall upon the ship owners of the chief maritime countries. In considering these problems it was essential to have the co-operation of the Dominions and India. They must hear in mind not only the position of tramp shipping, but the position in some of the great liner trades, especially those between the different parts of the Empire, which were menaced by subsidised foreign competition. The Govern-

ment was therefore informing the Dominions and India of the position as it saw it and seeking their views as to possible lines of ac+ieu. Scrapping Old Ships. The Government had been prepared

to place at the disposal of the shipping industry financial help on favourable terms for scrapping older British cargo tounage and providing a smaller quantity of up-to-date cargo tonnage, cither by construction of new or the modernisation of existing vessels. The object was to ensure a reduction in surplus ships and maintain the standard of efficiency of cargo fleets.

There lmd never been any intention of compelling any shipowner to take advantage of the scheme, if he did not wish to do so. Nevertheless, it had not been favourably received by shipowners. The Government was still propared'to co-operate in this matter. Various suggestions had been put forward for the assistance of British shipping by tho reservation of inter-imperial trades, preferential treatment of British ships or cargoes carried in British ships in Empire ports, differential duties against foreign ships which had the benefit of Government subsidies, etc. Thcso wero all measures which had their own dangers, but they might have to be considered if the proposals now outlined did not lessen the menace to tho British mercantile marine. In conclusion, Mr. Runciman urged the industry to make greater efforts to improve its position. Approval Qualified With Regret RESTRICTIONS INVOLVE PROLONGED DELAY. Received Wednesday, 8 p.m. LONDON, July 3. The shipowners arc considering the Government's proposals on July It’. In the meantime approval is qualified with regret that the proposals are hedged with restrictions which involve prolonged delay. Mr. Runciman ’s statement dashed hopes and causcjl disappointment in House of Commons shipping circles and those desiring to see more work in the shipyards. immediately Mr. Runciman's statement was concluded, shipping Commoners met and vigorously criticised the Government’s policy and sent a letter to the Times, declaring that they had listened with dismay to Mr. Runciman’s statement, and pointing out that responsible shipowners had informed the Government that “a scrap and build policy would not only help the shipowners, but also would do more harm than good. Yet Mr. Runciman announces the forcing of such a policy on the industry. Obviously the Government desires to encourage shipbuilding, but should not pretend that it is acting with any thought to the future of British shipping. The conditions of the grant seem impossible to fulfil and make the shipowners responsible for carrying out negotiations with foreigners without Government backing. Shipping and shipbuilding would benefit if tho Government took the advice cf the shipowners.” The letter agrees that, a temporary subsidy is essential until the Government decides a perfnanent policy for the protection of British shipping.

Policy in Australia Received Wednesday, 10 p.m. SYDNEY, July 4

The Prime Minister (Mr. J. A. Lyons), replying to a question in the House of Representatives at Canberra to-day, promised an early announcement with regard to the Government's policy in dealing with subsidised shipping. He added that the Government now had under consideration the policy outlined in the British Parliament by the president of the Board of Trade. No Legislation Possible Till the Autumn HOUSE TO DISCUSS PROPOSALS. Received Wednesday, 8 p.m. LONDON, July 4. Following Mr. Runeinian’s statement in the House of Commons on the mercantile marine, Mr. Baldwin, in response to Opposition requests, agreed that the House should discuss the subsidy proposals on supply. He explained that the proposals had still to bo discussed with the shipping trade, and that there could be no legislation on the subject till the autumn. French Subsidy Bill Passed by Senate PARIS, July 3. The Senate passed the Mercantile Marine Bill, approximating £2,000,000 for subsidies proportionate to tonnage ar.d speed for commercial and deepsea fishing vessels. '