GERMAN SUBSIDIES.

New Zealand Herald, Volume LV, Issue 17026, 6 December 1918, Page 6

GERMAN SUBSIDIES.

EFFECTS ON PACIFIC TRADE.

AUSTRALIAN LINE OUSTED.

Light is shed on somo aspects of Statesubsidised German shipping enterprise be-, fore the war to the detriment of British and Australian trade by the report of the Commission appointed by the Australian Minister for Trade and Customs in 1916 to inquire into British and Australian trade in the South Pacific Islands.

The islands depend chiefly for their supplies and trading facilities on outside sources. They import all kinds of foods, machinery, clothing, implements, timber, and a very great variety of cheap goods and knick-knacks from abroad. Copratheir main productr-is exported from all tho islands, and, in addition, sugar and bananas-from Fiji, Rarotouga, etc.; rock phosphate from Ocean Island and Nauru ; cocoa from Samoa; and minerals from New Caledonia. Tho total trade of tho islands included between 30deg. south and lOdeg. north is not less than £,5,600,000 inwards and £4,300,000 outwards, excluding the Philippine Islands. There can be little doubt, according to the Commission, that the trade of tue South Pacific must largely be dominated by the nation whose ships can give the best services at the lowest rates of freight. Before the war the British flag was flown by most* of the ships trading among lii? islands and groups of islands, but a foreign element, though considerably localised, had secured what appeared to be a firm footing, Shipping that entered and cleared German Samoa in 1911 was represented alracat wholly by British vessels, but in German New Guinea and neighbouring German possessions the whole of the steamships that entered and cleared appear to'have been under the German flag —it was from this quarter that the Germans drove an Australian shipping firm. A German official publication gives the following particulars relating to steam ships:— Under German Not under Flair. German Flaff. Possessions.. Arr. Tonnage. Arr. TonnageBismarck Archipelago, Solomon Islands, and Kaiser WilholmLand 578 431,119 Nil Nil Samoa .. .. Q 1,043 107 122.490

All the vessels under steam cited as not under the German flag were, in fact, all under the British flag.

Attractive Terms to Settlers. The North-German Lloyd, by instituting a service 1 to Sydney, via German i>ew Guinea, introduced a very serious competition, which drove the shipping of s.n Australian firm out of the German New Guinea and the German islands trade. The German fleet, consisting of three modern steamers, of over 3000 tons, was heavily subsidised. \ In 1898, the Australian firm sent their. steamers to trade with German New Guinea and other German possessions, and continued to do so, in spite of opposition , from the German Jaluit Company, till 1907, when a director of the North-German Lloyd went to Rabaul, and undertook, in consideration of the settlers agreeing to sign undertakings to ship exclusively with that company's steamers for five years, to grant very favourable shipping conditions, and specially low through rates to and from Germany, without the option of a British port, but with the oDtion of selling copra in Svdney and cancelling the through hill of lading. It did not pay, however, to sell in Sydney with the through-freight concessions,

These undertakings were readily entered into by German and other settlers. .The freight for copra was to be 20s from German" New Guinea to Sydney, and 55 marks (53b 6d) a ton through from German New Guinea to Antwerp, Bremen, or Hamburg (optional), including cost of transhipment in Sydney.' Freights from German New Guinea to Sydney were £1 per ton, and from Sydney to European ports by any cargo line, 40s per ton upwards, in addition to which there were transhipping expenses iii Sydney, 4$ per ton, making a minimum total cost 64s per ton, as against 55 marks (53s 6d), a difference of 10s 6d a ton in favour. of shippers by the North-German Lloyd Line. The German's fleet was excellent, his- subsidy ample, his cartrb assured, his organisation , complete. The result was that his Australian competitor had to withdraw. ' Minor German Competition. j There was other, but not so serious, ; competition. Hernsheim and Co., of German New Guinea, had two auxiliary schooners trading in the British Solomons,! with an established depot at Guadalcanal! and the tfahrit Gesellschaft had six! auxiliary schooners trading in the Caro- 1 line, Marshall, and the Gilbert and Ellico groups, and maintained a mail service from Hongkong to Sydney, via Caroline ' and Marshall Islands, arid New Guinea. The Jaluit Gesellschaft, who supplied coal to the German Navy, chartered sailing vessels to bring Westjiort coal from New Zealand to Ponape and Jaluit, and loaded these ships with copra from those ports, and also from Butaritari, to all parts of the world. By this mathod they obtained the best steaming coal in the" Southern Hemisphere and shipped tjieir copra at very cheap rates. In fact, the German seems to have had the flily complete shipping organisation between the Islands and the East Such was the German pre-war competition, a competition which, though! serious enough in itself, seemed only the i beginning of wider operations. The Australian and New Zealand ship-' pine community, if not well informed, knew at least that the Germans were contemplating schemes to capturo a larger share of the Australian and New Zealand trade, and to develop extensively their commercial influence by affording "greater trading and shipping facilities in the South Pacific, even as' far as their possessions in | Samoa. They had also proposed a service to Fiji, Intending that the line from Singapore should, after calling at Rabaul, go on to Fiji. Two boats were actually en route for one of the new services when the war broke out.

The commission point out that by a law of June 10, 1914, the Chancellor of the German Empire received power to subsidise for 15 years the costal sci-vices of the Empire with the Far East, Australia, and th? German possessions in the Pacific, the subsidy to be paid to a Germany company, and the total sum of the subsidy to be UOO.OOO marks (£650.000). Further, the Chancellor was authorised to maintain until March 31, 1917, the subsidised line to Australia.- It was stipulated thut regular maximum services were to he made every four weeks on the Honpkonz-Rabaul-Sydney line, every eight weeks on the Singapore-New Guinea-Samoa lir.e and every three months in the German islands} the mail boats were to be of German construction, and of, a speed of I 9A knots and 11 knots. The war put a etot; to theßo projects, but they provide- ft I useful warning.