JAPANESE TRADE

New Zealand Herald, Volume LXX, Issue 21515, 12 June 1933, Page 8

JAPANESE TRADE

The report that Japan has virtually declared an anti-British tariff war because of the action of the Government of India in raising the duty on certain cotten piece-goods, cannot be accepted, in view of the statement of Count Ishii, delegate to the Economic; Conference, that his country is not actuated by an isolationist policy. The possibility of retaliation cannot be dismissed, however. The reluctance of India to adopt the anti-dumping measure which will come into operation in October was due, according to an article in the Times Trade and Engineering Supplement, to hints of retaliation, notably in regard to Indian raw cotton, of which Japan has been the predominant purchaser. It is now asserted that "prohibitive" duties may be imposed by Japan on Indian raw cotton and iron and also on Australian wool and wheat and Canadian timber and wheat. As far as Australian wool is concerned the consequence of an excessive. duty would undoubtedly react against Japanese industry. Last season Japan purchased 507,772 bales, representing 22 per cent of the total Australian shipments. It is inconceivable that because of a tariff dispute with India she could cut adrift from the Australian wool market, particularly at a time when there arc no surplus stocks and there is every indication of a stronger demand from other manufacturing countries. Threats, however, are bound to create an atmosphere inimical to international agreement upon obstacles to trade. The recent expansion of Japan's manufacturing industry and export of cheap goods which is described as a "ruthless assault on world trade," is not regarded by authorities as a flash in the pan. Temporary circumstances unquestionably have stimulated her industry, but, nevertheless, there are features which make for some degree of permanence. Labour is cheap and unemployment is not of great dimeu-

sions. Severe competition from Japan is not confined to the Empire countries. The Australian trade delegation now in the Far East found that in the Netherlands Indies lowpriced Japanese goods, particularly textiles, had undercut supplies from Holland as well as from Great Britain, and there was talk of raising the tariff. In Sourabaya Japanese cotton dresses could bo bought for the Australian equivalent of fourpence halfpenny. An electric iron cost 2s Gd, against 10s 6d in Australia. Here Japan has an exchange advantage of 35 per cent. This competition* is a problem which the conference will not be able to avoid.