TRADE EXPANSION.

New Zealand Herald, Volume LXVII, Issue 20656, 30 August 1930, Page 8

TRADE EXPANSION.

DOMINION AND FAR EAST.

OBSERVER'S CONCLUSIONS.

ADVICE TO EXPORTERS.

No. 111. Various conclusions lie lias reached nn the prospects of developing New Zealand trade with Japan and South China are summarised by Professor H. Belshaw in the concluding portion of the bulletin he has prepared for the Department of Industries and Commerce. If New Zealand goods were placed on the same footing as the goods of her competitors in the matters of direct shipping and local trade representation, he believes there would be an immediate increase in the sales of many of them, and that the ultimate market in some cases might be

quite appreciable. \ Although the per capita purchasing power of China is small, the country i 3 rapidly becoming industrialised in certain centres. The probable effect of this will be an increase in the per capita purchasing power, at any rate of certain districts, and the growth of a larger class than at present of foremen, office workers and the like with a. larger purchasing power. Coupled with this is an increase in the affectation of European habits of food ?nd dress. The potentialities opened up v by these factors are very great. An increase in the demand for butler, dried aDd condensed milks, baby foods, malted milk and the like seems piobable, and for some time these will have to be obtained from outside sources. Chinese Trade Prospects. Supplies of butter for China will require to be tinned for some time. Wool also will become more in demand as European styles of clothing tend to increase in popularity, while the demand for tallow, tinned fruits, jams, sauces, honey and tinned meats will also be likely to increase. The poorer quality of hides and leathers are likely to meet strong competition from the local products and from rubber, but there should be a market for good hides and leather from New Zealand, provided these can bo landed at a reasonable price. The market in beef, mutton, lamb and pig pro« ducts seems capable of only limited es« pansion.

Summarising the well-known hindrances to the expansion of the Dominion's trade with the Far East, Professor Bclshaw says the most serious difficulty is the absence of direct shipping, which not only involves additional transport and handling charges, but also delay and in some cases deterioration of goods through the necessity for transhipment at Sydney. The following comparison will serve to emphasise the disability New Zealand producers suffer m comparison with Aus-. traJia. in regard to freight:— Freight chaiges from Auckland to Manila, Hongkong and Japanese ports:— Butter, 7s 6dabox; condensed milk, 95s a tori of 40 cubic feet; milk powder, 90s; casein, 80s. From Sydney to the samo ports the corresponding charges are:—■ 4s 6d per box 3 52s 6d per ton, 52s 6d, and 37s 6d. The rates from Auckland do not take into consideration the extra cartage and storage involved if, as often happens, a ship to ship transfer cannot be effected. Some Other Handicaps.

A further handicap is the difficulty which New Zealand exporters experience in making contacts with suitable agents. This has been largely overcome by one New Zealand firm, however, which appears to be well served by its representatives. This handicap would be removed if New Zealand were represented in the East, by a trade commissioner. Inadequacy of general publicity in the East is also an important handicap which would best be overcome by an accredited trade commissioner.

In the matter of tariffs, New Zealand is, in general, on the same footing as her competitors, although in the Philippines United States goods are favoured. Under the recent trade agreement with Japan, New Zealand enjoys the tariff convention in respect of butter, so that she has advantage over certain competitors. Cold storage appears to be adequate to meet any needs in the immediate future in centres such as Hongkong. Kobe, Osaka. Yokohama and Tokyo. In China and the interior of Japan cold storage and refrigerativa transport are inadequate. The position is improving, how-* ever. How to Promote Trade. To New Zealand exporters attempt* ing to gain a footing in Japan. Hongkong and South China, Professor Belshaw; makes the following recommendations:— In the absence of a trade commissioner the n»£»es of firms engaged in the import trade. Jkr of manufacturers, may be obtained from trade directories published in English, and from chambers of commerce. On the whole, it would be desirable to utilise the services of European firms, at any rate in the initial stages. In respect of new ventures to establish' business, it would be advisable to tesb the market by small trial shipments. Where possible, sales should be made f.o.b. main New Zealand ports, especially when dealing with foreign firms.

An irrevocable letter of credit without recourse should be insisted upon, except where the New Zealand exporter is quite sure of the business standing of those with whom he deals.

Exporters should insist on selling under their own brands and trade names and should make sure to register these in advance.

Exporters should endeavour to conform as closely as possible to the best existing practices in respect of packages. -As most of the handling at Eastern ports is done by manual labour, packages should not be too large. In respect of tinned goods, cartons, etc., bright colours, such as red and gold, are likely to help sales. Descriptive material in two languages is desirable.