SHIPPING COMBINES.

New Zealand Herald, Volume LIX, Issue 18153, 27 July 1922, Page 7

SHIPPING COMBINES.

THE QUESTION OF TRADING.

NECESSITY MAY ARISE. POST-WAR COMPETITION. [FROM Otlt OWN CORRr^PONnKXT.] LONDON. May SO. At the geners! meeting of the Elder i ; Dempster and Company, which possesses ] | important interests in shipping trades j ' between Canada and South Africa, and | '■ between the United States and West- 1 i Africa, as well as to and from the Gulf | of Mexico and other parts of the world, j Sir Owen Philipps said that in earlier ! days it was not unusual for steamship ; owners also to act as merrhant-s and j traders, a policy still being pursued by ! some foreign shipping concents, notably 1 one of the big Danish maritime com- | panics, which also carries on a large i mercantile business. The well-known i German firm of Carl Woermann, prior to | the war, combined a merchant business with shipowning. Doubtless this course of action has certain advantages from the steamship owners' point of view, but in Sir Owen's opinion the best interests of the merchants and shipowners engaged in any trade are secured by limiting their activities to their respective spheres. Large Business at Low Profits. ! "Since the war, owing to severe com- | petition in business." he said, "there has j been a greater tendency than ever for all j commercial concerns, whether manufaej turing. merchanting. or shipowning. each jto combine- in larger units. Within ' reasonable limits, there is much to be i said for the development- of business j along these lines. A big concern inI forested in a particular industry, proI vided it is well managed, is able to carry on its operations at a smaller margin of • profit on each individual transaction, and I thus benefits the whole community. At j the same time, in this free country, so ; long as we are not unduly hampered by | bureaucratic control, there will always be ample room for the smaller firms. On the other hand, if any large group of j merchants consider it to their advantage to do their own carrying, this naturally alters the whole position. Such action on their part may compel the steamship owners, however reluctantly, in order to secure the necessary freight, to take steps to obtain cargo for their own vessels."

Whiie hoping that it may not be necessary to do this. Sir Owen cannot shut his ej'es to the fact thJtt, in the long run. it would doubtless be to the advantage of the steamship owners to adopt such a course, because, glancing at the dividends paid by the merchant houses in the last generation, it was evident that if the profits of merchants and carriers were divided between the two interests in proportion to the capital employed in their respective businesses, as would be the natural outcome of each encroaching upon the other's sphere, the shipowners would have more to gain than to lose.

A More Hopeful Outlook. In his presidential address at the Baltic and White Sea Conference in Brussels. Sir W. ,]. Noble did not attempt to disguise the facts that we are suffering from the deepest depression that any of us has ever experienced in a world that is still stunned by an appalling economic situation, but he was persuaded that, given the right spirit at work, means will be found to bring order out of chaos. One hopefu] sign wa* the general realisation of the fact that a, wellorganised economic world must have peace for its foundation: another hopeful sign was found in the changed attitude of labour, which, so far as seafarers were concerned, had made it possible to preserve peace and to promote harmony. " We have," said Sir William, " without any intermediary, met face to face with our own employees, and have come to an amicable and a more or less permanent settlement. In this way I venture to say that the shipping industry has shown the way to industrial peace, the way to reduce unemployment, and the way to a real restoration of the trade of the world."