THE SHIPPING CRISIS

Nelson Evening Mail, Volume LXVI, 11 February 1933, Page 3

THE SHIPPING CRISIS

BRITAIN AND FOREIGN SUBSIDIES

COMMENT BY SIR ARCHIBALD HURD LONDON, 22ml December. British shipowners have taken time. Io make up their minds upon the attitude to b c . assumed toward shipping under foreign flags which is supported hv State subsidies (writes Sir Archibald Hurd in the Melbourne “Argus”). The subsidies are said to amount to £30,000.000 a year; if proportionate aid were to he given to British ships the Exchequer would have to pay upwards of .021,000.000 each year. Italy, .Franco, Germany, (he United States, Japan, to name only five of the- leading maritime nations, are involved in this movement, which led (lie Hon Alexander Shaw, tin' chairman of the P. and O. the British India, and other associated companies, controlling 2,217,724 tons of shipping, to declare the other day that matters had readied such a pitch that Great Britain almost alone among the nations, had a mercantile marine run on ordinary economic lines. “In every single trade in which the P. and O. is engaged,” he added, “it is faced by the competition of foreign vessels built with ill,, assistance of very large subsidies." Lord Essendon, who presides over the .Furness Withy group, and other leading shipowners have summed up the .situation in other words, but to the same effect.

The Chamber of Shipping of the United Kingdom and the Liverpool Steam Ship Owners’ Association, the two representative organisations, have agreed that a formal plea for the abandonment of all kinds of flag discriminations, as well as for the removal of other trade barriers, shall be made at the World Economic Conference. The Liverpool organisation has passed a series of speeilic resolutions, flic most important of which, after setting forth the opinion that the present state of depression in the shipping industry is due to the general decline in the volume of world trade brought about largely by the existence of trade barriers and acts of discrimination, including subsidies, declares that, pending the holding of the World Economic Conference, Great Britain should take all possible steps to procure the co-operation of as many nations as possible in an endeavour to procure the removal of all such barriers and acts of discrimination.

BRITISH SHIPS AND FOREIGN TRADES

The Chamber nf Shipping is supporting this policy, hut it lias gone a step further. It has prepared an analysis of the employment of British ships in Imperial and foreign trades as follows: Tested both by tonnage entrances and earnings, we estimate that intraimperial trade finds employment for only a little over one-third of the British tonnage available for overseas trade, and that that employment would not be substantially increased if the whole o'f the intra-imperial trade were reserved exclusively for British shipping. The remainder of such British tonnage—nearly two-thirds—finds employment in trade between the Empire, including the United Kingdom, and foreign countries, or between foreign countries. Unless those trades are re-established there can bo no future for the British mercantile marine, as it exists to-day. Jt follows, therefore, that, the primary concern of the British shipping industry at the World Economic Conference must he the removal of the trade barriers of every description that have played such an important part in bringing about the deplorable diminution in the world’s trade, including that of the United Kingdom. Free access to an open freight is essential to the prosperity of international commerce. There can he no such market in countries in which the ports are not open to all ships, under all flags, on terms of absolute equality. There can be no such market in any country which is discriminating in favour of ships under its own flag, whether such discrimination take the form of building 4>r operating subsidies, the granting of preferences to cargoes carried in such ships, or impositions or restrictions imposed on ships under other flags or on their cargoes. All such discriminations are in themselves trade banners, and they lead, moreover, to the creation of other barriers from the retaliation they provoke.

While the Chamber of Shipping contends that subsidies to British shipping could form no permanent basis for the maintenance of the position of the greatest sea carriers of world trade it admits that if the British mercantile marine is to continue as it now exists it will be necessary for the United Kingdom to meet foreign State-aided shipping competition, if it be persisted in, by the grant of subsidies to British shipping pending the restoration of world trade.

Jn a confident memorandum to the British Government the chamber lias summarised the methods of reservation, restriction, and discrimination that are, or could he made, available to Great Britain if it were forced to abandon its traditional policy of freedom of the seas and of access to all ports on terms of equality in all international trades, and to take retaliatory steps in defence of its own shipping. ' “Our aim,” it is added, in explanation of the length of its memorandum, “has been to provide a basis for the arguments that could be brought before the World Economic ( onterence in support of the demand ior the sweeping away of all forms of (lag discrimination, believing that the inevitable consequences of the adoption of such methods of retaliation being forced on the British Empire will drive homo at the conference the fact that the abandonment bv all nations of flag discrimination is essential to the prospeiity ol il nernat ional commerce as a whole." I he lion Alexander Shaw has made if clear that he, in common with an increasing number of other leading shipowners, favours linn action if ar* rument fails. British owners look round and sec everywhere foreign nations which dose their coastal trade to British ships, while the coasts of Britain and Imperial trade remain open to all comers on equal terms. “Every year ships of foreign countries highly subsidised by their Governments, arc cutting deeper and deeper into British trades. That is a new and grave menace to the most essential of all British industries," says Mr Shaw. British'Shipowners do not fear economic competition Ironi any country in the world; but it is asking the impossible to expect, them, cither in cargo or liner trades, to go ou for ever stand-

ing up unaided to face what is, in fact, a carefully developed form of economic warfare financed by subsidies amounting to -C .‘30,000,000 annually. AN IMPOSSIBLE SITUATION The Chamber of Shipping has summed up the whole matter in the succinct phrase, that “ships under other Hags cannot compete with State-aided ships,” adding that such State-aided ships, like dumped goods, have no place in trade, since to the country to which they belong they have no commercial value, and they are a standing menace to the freight 'market and hamper the operations of all ships, under their own and other flags, operating on an economic basis. Before retaliatory measures arc taken British owners, however, intend to endeavour to procure the eo-opera-tion of as many nations as possible pledged to work for the re-establish-ment of world trade through the removal of trade harriers, including the modification of tarill's upon the goods carried and the removal of all forms of discrimination, including subsidies, in favour of ships under the national flag by which such goods are carried. Then an appeal will he made to the World Economic Conference, supported by the International Chamber of Com-, nieree. If these arguments do not succeed the British Government, it is authoritatively stated, will adopt one or more of the methods suggested by the chamber for the protection of British shipping. Mr Baldwin declared recently, “Foreign countries are building ships with subsidies and running them with subsidies. That opens up a very grave problem. Whatever steps other nations may take, we cannot allow this great industry to suffer that kind of competition from foreign nations.”