PACIFIC TRADE

Nelson Evening Mail, Volume LXIV, 5 August 1931, Page 8

PACIFIC TRADE

AMERICAN SUBSIDISED SHIPPING

MAY DRIVE NEW ZEALAND AND BRITISH OEE

With the establishment of a new Ame-rican-controlled steamship service to operate between Australia, Fiji, and New Zealand and United States ports, grave, fears arc aroused that the death-knell of Dominion, and for that matter, Australian and British shipping in this part of the world, has been sounded (stales the Christchurch' “Sun”).

American vessels are aided hv Stales subsidies overwhelmingly higher than any enjoyed by their competitors, and are further assisted by the fact that they alone can trade between the Hawaiian Islands and the United States. ' "So it is considered certain that unless New Zealand, Australia and Great Britain unite to protect their shipping’, the United States will control the Pacific trade.

It is a long story dating back to 1898 when the United States'annexed the Hawaiian Islands. Two years filter legislation was introduced debarring foreign-owned vessels from carrying cargo from one part of the United States or its possessions to another part. In effect this meant the New Zealand, Australian and British vessels were prohibited from sharing in the trade between Hawaii and the United States —a trade which some authorities estimate is alone so valuable that United States vessels could afford almost to carry New Zealand and Australian passengers and ctirgo’for next to nothing. Tremendous though this handicap was it could be faced, and was faced, so long as 1 American shipping interests made no concerted bid to capture Australian and New Zealand trade. Now, however, the position is altered. By the new shipping line, those interests, aided by the State,'“have challenged for the whole Pacific trade. Competition, provided it is between bodies placed on a more or less equal footing, is generally regarded ns advantageous, but when tne advantages enjoyed by one body amount to such a limit as thoso enjoyed by the new lino the result is tantamount to granting a monopoly. And what are those advantages? N . in 1928 the Jones-White Act became law’ in the United States, its object being to provide finance for the extension of the shipping interests of the United States'..'!. Behind it there is the desire to-build up a strong mercantile fleet, which, iii lime of war. will act as an auxiliary for the United States Navy. Between'the passing of'that Act and 30th June, 1930, this had been done mider. it s„pvovisious Shipping companies, to whom loans hayp.b'een authorised :•'•••• 22 New vessels built ,- 49 Vessels converted 13 Total amount involved. £22,800,000 Loans granted under (lie Jones-White -Act bear interest at the rate of 3 per cent., which is considerably below tlm ruling rate in the United States. I lie subsidies granted arc calculated on a basis of tonnage and speed, and in the. case of the new steamers now being built for the New Zealand and Australian trade, the subsidy will amount to £2 a nautical mile for the outward passr age. from the United States. The direct State assistance enjoyed by this now line is estimated at: — £ Yearly subsidy Yearly saving'in-interest ......... £O,OOO Total yearly subsidy about 025,000 -And the subsidy enjoyed by Lhc. Union Steam Ship Company, which earnest he mails between. New Zealand and the. United States, amounts to only £72,000 a year, and this is subject to a 10 per cent, reduction as from Ist April, 1931. The subsidy is. made up as follows A _ Vancouver ’service-. (13 trips yearly) -A?A1....... £15,000 San Frapcisco- service (13 trips yearly.) £27,000

Toliticians and private business men are- already greatly concerned regarding the matter, and, a move has been made to urge the Government to act. Ibo shipping industry in New Zealand is an important one) giving employment to about 1500 men. - j. . If nothing is done it would seem that there is ..'small hope of New Zealandowned vessels surviving tlie conipetitiou waiv At present there is no suggestion to reduce fares, but the fact remains that the new shipping line will bo greatly assisted in having new and palatially-equipped vessels. : There is, however, ,% way of combating 'this cbmpetiticm.■ .If the United States can debar foreign-owned vessels from sharing in the Hawaiian-United States trade, why should not New Zealand, Australia, and Britain introduce similar legislation debarring . United States’ vessels from sharing with their Vessels the Australian, Fill, and New Zealand overseas trade? 11ns would:appeah a-reasonable lino of retaliation, althbiigh.- it " would require legislation. .. New Zealand already has the machinery for such a step. The Customs Law Acti’pf ’I9OB gives the Government power hy Oi’clef-iif-Council, subject to approval of the ; British Government, to impose such prohibitions or restrictions or duties on tonnage upon the ships of a country if British ships are subject in that country, citlior .directly or indirectly, to anv prohibitions or restrictions. In the case of Fiji, a Crown Colony, similar legislation would have to he passed-by the British Government,' and in the case of Australia hy thd Federal Government. This line of retaliation is freely supported unless some agreement bet Ween the United States and the other countries involved can tie reached.