THE BANK OF NEW ZEALAND.

Taranaki Herald, Volume LXI, Issue 144129, 26 June 1913, Page 4

THE BANK OF NEW ZEALAND.

ADDRESS BY THE CHAIRMAN. The annual mooting -of tho sharoholders of tho Bank of New Zealand was hold to-day. Tho Chairman (Mr. H. Beasuchamp), in moving tho adoption of tiro report and balance-sheet, said: — You will havd seen by tho report and balance-sheet, recently distributed to shareholders, that tho bank has experienced another good year. The amount available, for distribution, though not quite as large as for tho previous year, is still very satisfactory, and the board is ablo to recommend tho jwyment ot a dividend at the same rate as formerly, and tho transfer of £175,000 to the Reserve Bund. Tho position of tho bank, I am pleased to say, continues to bo thoroughly sound, and its business fully maintained in all departments. In conformity with our usual custom, I will refer briefly to tho principal items in the balance-sheet. Capital.—-The paid-up capital remains the same as previously, namely £2,000,000. As indicated at the lasi half-year general meeting, the question of an increase in the bank’it capital has been engaging our attention. A recommendation on tho subject has been made to tho Government, and indue course no doubt a measure will be brought forward in the session of Parliament now about to open, embodying, we trust, proposals that will Ija lair and equitable to all the interests canconiwi. Until the views nl tho Government are made public, it would be premaiuro loins to into any discussion on the subject. A committee-, acting in the interests of the ordinary sharoiioiiiors generally, lias called, for duly -1 proximo, a meeting in terms of Clause 79 of the Deed o_f Settlement for the- purpose of considering the question from thoir own particular standpoint and arriving at resolutions on tho subject, .which will no doubt be communicated to the Government in due course. '.At that meeting yon will have full opportunity lor voicing your views on tlui subject. It is proposed, therefore, to limit the business ot this meeting to the matters usually dealt with at an ordinary general mooting, leaving the capital question tor discussion at tile special general meeting called lor 4th. proximo. . The Reserve Fund.—As already mentioned, t[io board proposes to place £175,000 out of profits to credit ot this fund, making the total £1,675,000—a most satisfactory figure having regard to the fact that seven years ago tho fund amount to only £51,2.?6. With tho balance proposed to bo cairricd forward (£43,117). the- reserve fund and undivided profits will amount to £1,418,117. Notes in circulation are less by £36,286 than at March 31, 1912, and now stand at £994,680. Deposit's (£16,414,639), oxhilbit an increase of £580,772 on the figures of ;a year ago,, mainly duo to large:r Government balances. Free depotlits have shrunk a little, but on the oliher hand fixed deposits, notwithstanding tho high rates for money ruling; outside, have been well maintained, amd in fact show a slight increase. The fixed deposit rates were raised by onr-haif per cunt, during tho year. Bills payable and other liabilities, £1,367,081. There is practically no variation in this .item as compared with twelve months ago. Coin, Bullion, Money at Short Call, etc.—Coin and cash balances, and bullion, together stand at £3,148,930, an increase of £44,417 as corapored with the figures of a year ago. ' Money at short call, Government and other securities in London, also show: an in-' crease, the present figures (iM,031,033) being greater by £764,878 than at March 31, 1912. Larger Government balances recount for tho major portion of this increase.

The totals under above hoe (lings, together with tho amount of bills receivable and investments in the ; colonies, aro equal to 58.76 per cent, (inr 11s 9d in the £) of the total liabilities of the bank to the public. Bills receivable, in London; and in transit, stand at £2,847,12®, an increase of £440,860, caused principally by an expansion in tho value of the Dominion’s exports. , Investments in the colonics aro less by £307,979 .than at March 31, 1912. The transfer of somo Colonial Government securities to London Office practically accounts for this decrease. Advances.—The remarks made in tho bank’s report of twelve months ago apply also to-day. Tho monetary conditions then existing have not materially altered, and the bank, while responding to the reasonable, requirements of its customers, has xieoessarily adhered to a cautious and cr/hservativo policy in regard to advances'Bills discounted, which now stand at £1,253,254, are more by £33,179, and other advances (£9,504,075) ’ aro less by £163,673 than at March 31, 1912. I may mention that tho bjiiances owing by Purchasers of Assets Realisation Board assets, having been reduced to comparatively small figunsu, are now included in “Other Advances,” and tho item therefore ceases to appear in the balance-sheet under a separate heading. Landed Property and Premises.— After appropriation now- made of £40,000, this item stands at: £467,827, as against £420,538 last your. This considerable increase has betsm caused principally by purchase of larch and promises at Sydney, and of a more central site in Palmerston North. The bank already held another property in Sydney, but the building was mreless for banking purposes. In preference to erecting a new building there, the board considered it advisable to take tho opportunity of securing a site which offered in a more central position with suitable building already erected thereon. The former property is in tho market for sale, and we expect to dispose ot it shortly. Tho Palmcniton. North purchase, on which a building will shortly be erected, gives the bank a prominent and central site in the heart of the business portion, of the town. Apart from these two transactions, several new buildings have been erected, and others altered and enlarged, the continued development of the hank’s business having rendered such works necessary.

Profit and Loss.—Tlio net profits for the year, after paying the £40,000 interest on guaranteed stock asnd making all necessary appropriations, including provision for the bank’s annual grant to the 7 J rovident Fund and the allocation of £40,’000 in reduction of bank premises and furniture accounts, amount to £302,530, as compared with 1

£331,182 at March 31, 1912. Adding tho amount brought forward from last year (£40,587) and -deducting the amount of interim dividend at 6 per cent, paid in December (£60,000), tin sum available for distribution is £283,117. The directors now propose to pay a further dividend of 6 percent, and a bonus of 3 per cent, on ordinary shares (making 15 per cent, for tho year) and a further 4 per cent, on preference shares (making 10 per cent, for the year). Tho distribution to shareholders will therefore amount to £125,000 for tho year. As already mentioned, it is proposed to transfer £175,000 to the reserve fund, ami to carry forward the balance, £43,117. Tho dividend and bonus will be payable in Wellington to-morrow, 27th inst., and at branches on receipt of ad--IK°’ BOARD OF DIRECTORS. Mr. J. M. Johnston, one of the Government directors on tho board, retired at March 31, the term for which he bad been appointed having expired, and Mr. J. 11. Upton, of Auckland, was appointed in his place. . The board have* passed a resolution appreciative of Mr. Johnston’s services. Mr. Upion, as you are probably aware, is a well-known and representative business man in Auckland, and I hare much Measure in introducing him to you today. Since we last met yon, our lain chairman. Mr. Martin Kennedy, has paid a visit to Europe. During his slay in London he was associated with tho Foard there-and has no doubt acquired valuable information conn cited with our London business. He has j just returned to Wellington, and I have pleasure in welcoming him hack. At the first meeting of the board in April last, my colleagues did me vho honour of elening me to the position of chairman of tho beard for the current year. LONDON BOARD. Wo arc much indebted to tho members of tho London Board for the care which they have displayed in supervising our extensive business at that point. Wo have to record with regret the death of Mr. Richard 11. Glyn, for many years chairman of the London Board. Those of you whoso memories can recall the events of the early nineties, will remember that Mr. Glyn became first associated with the bank as president when tho Head Office was transferred to London. When the legislation of 1894 effected transfer of tho Head 1 Office to Wellington, Mr.-Giyn’s valued services were retained in the capacity of chairman of tho London Board, a position which ho occupied until his decease. Mr. Frederic Lubbock, who lias been a member of the London Board for tome years, hao boon appointed chairman in succession to Mr. Glyn. Mr. Lubbock is a member of the well-known banking family of that name, anti is a gentleman of large financial experience, holding a- seat on tile boards ot several London financial institutions. Our important London interests will, I am sure, be safe and prosperous under his capable guidance. STAFF. 1 would like to record my colleagues’ and my own appreciation of the great services accorded to the bank during the past year by tho London, Australian, Fiji and Now Zealand staffs. To our General .Manager (Mr. Win. Callender) and to our fiOndon manager (Mr. A. Kay) our thanks are especially due for the able and conscientious manner in which they have carried out tlieir onerous duties. GENERAL REMARKS. - It will, no doubt, bo expected of mo that 1 should make some remarks with regard to tho present: ■ financial and commercial conditions. Unquestionably, stringent monetary conditions continue to prevail, and are more accentuated than cm tho occasion when we last met you. Tho causes of the existing tightness are, in tho main, not local but general, and it is because ot the nature of the circumstances that have produced them, and the extent of the area over which tho causes aro operating, that I am not too sanguine of an early return to easier conditions. An exceptional feature influencing tho European money markets during the last few" months has been the war in tho Balkans, conjoined with tho political uncertainties which that war has involved. As a consequence, each of the groat European Powers has been making strenuous endeavours to strengthen its own financial position, and to obtain the control of gold supplies so as to prepare as effectively as possible for tho contingency of itself becoming involved in hostilities. At London, Papis, Berlin and Vienna, high bank rates have consequently been ruling for many months past with that object in view.

A review of tho events of recent years serves to show- that there must have been an enormous waste of the wealth and substance of the world in the wars that have taken place since tho commencement of . tho twentieth century.

An abnormal and increasing expenditure upon armaments has, at the same time, been going on among all the leading nations-of the world, and so tremendous has this expenditure been that it is becoming a, menace to tho finances of some who are bent upon persisting in tho race for naval and military supremacy. _ Other nations are also coming into the field. Turning to the East, wo see Japan taking her place ns a world power and calling for the financial backing necessary to enable her to maintain her fleet and army in a state compatible with her pretensions, Further, China is bestirring herself, shaking oft tho lethargy of centuries, and displaying a disposition to follow tho lead of her island neighbour. Her call for the means to acquire modern arms and armaments, and for capital to exploit her vast undeveloped resources, is already being heard in the money markets of tho world. These are. considerations of national and political significance to which tho financial barometer is keenly sensitive. They constitute in themselves a situation sufficiently disturbing to account for a largo part of tho monetary stress which the civilised world has been and is experiencing; but there are other features to which I desire briefly to refer that are also exercising a most potent influence' on tho financial position and outlook. Concurrently with, and to some extent as a consequence of, the deplorable destruction of life and property that has been entailed by actual hostilities, and tho absorption of capital in the building of battleships and growth of armies, a keen industrial activity has been experienced

in almost every quarter of tho civilised world, involving a very strong demand tor capital supplies to finance manufactures and production. Tho steadily improving social conditions of this world and the higher standard of living which is now being generally adopted may also be set clown as among tho originating causes of tho scarcity of money. Then there is the assimilation of western ideas that is going, on among the eastern nations of tho world, and tho resulting tendency to frame tho requirements of life—individual and social—on tho basis of western models. But perhaps more important and weighty than all these, is the heavy perennial demand arising in connection with tho colonisation and development of tho unoccupied lands of tho world—work which, year by year, goes on in continually increasing volume. Apart from tho natural increnso of population occurring yearly in the new world, and tho necessity for opening up channels of employment whereby the units of these growing nationalities may earn a livelihood, a. steady stream of emigration from the, old world is continually flowing to the now lands across tho Atlantic. Discontented with tho existing conditions of life and labour in tho lands of their birth, and despairing of improvement, tho European peasantry are in over increasing numbers migrating to the American Continents. Attracted and encouraged by tho experiences of the earlier settlers, their exodus to the West assumes every year larger and yet larger proportions. In a small way, wo have experience of it in our own land, but, with our restricted immigration, we can hardly have any clear conception of. the phenomenal development that is going on in such rapidly progressing portions of the earth as, for example, Canada and the Argentine. It may, however, assist in emphasising the point to mention that during tho" year 1912, the immigration into Canada reached the largo aggregate of nearly 395,000 persons, showing an increase of over 13 per cent, on the total for 1911, which was itself a re- J cord year. Tho call for capital to assist in settling this largo population in its now home, and to furnish it with the means of earning its subsistence, is in itself enormous. During tho year 1912, nearly £47,000,000 of tho new capital issues on the London money market were on Canadian account, and over £20,000.000 on account of the Argentine. It will bo readily seen how tortile a channel this is for the drawing elf of ,surplus supplies of British and Continental capital. j In sympathy with the increased activity of industry, tho volume _ of British* trade shows a largo expansion, the totals for 1912 having reached the enormous aggregate ot £1,344,169,000, tho highest ever recorded, being an increase of £107,133,000 over the figures of the previous year, 1911 —which was itself a record year. Since Juno, 1909, continuous quarterly trade increases have taken place. Tho “boom” in that great industry," shipbuilding, which commenced some. time ago, is fully maintained, and nothing points to au early decrease in activity. In this connection 1 may mention that on March 3i last, there were 563 vessels, aggregating 2,063,700 tons, under construction, as compared with 545 vessels, totalling 1,686,000 tons, in the corresponding quarter of 1012. It is natural to expect that, in the circumstances, the appeal to tho London mar'ket for the capital to .finance such a huge vela me or business would be extensive. As a matter of fact, the capital issues on the London market in 1012 reached the largo total of £210,850.000—an increase of £19,090,000 over the" figures of 1911, Tho amount is, of course, far short of the figures for 1910, when £267,439,000 was raised on tho London market—an altogether, abnormal sum; so much so that tho business was clearly overdone and tho future heavily discounted. The “slump” which subsequently occurred (and 'from the effects of which wo are even now still suffering) is undoubtedly attributable to tho excessive amount of this class of business at that time undertaken ‘

Tho combination of adverse influonccs above mentioned, operating at one and tho same time, have constituted a drain upon tho financial resources of tho world that has been stupendous, and tho marvel is not that there has boon financial stringency, but that the stringency has not been much more pronounced. Tho world’s gold production shows steady expansion in recent years. In 1012 the output ■ was tho highest on record—about £97,000,000; and it has trebled within tho last twenty years. Nevertheless, tho growth is in no sense commensurate with'the increased credit requirements, and there is reason to. fear that, at tho present time, tho available gold reserves, forming the basis upon which the huge superstrucj turo of credit rests, are quite inadequate. Tho efficiency of tho existing supply of the precious metal is, to a considerable extent impaired by the tendency on the part of some nationalities to hoard —a disposition to prefer tho possession of the gold to tho command of the credit which tho gold can secure. At the present time, the most persistent call upon tho gold. reserves of tho world is from India—a country which, with comparatively ‘ light external indebtedness, .exports yearly a large surplus (last year 58 per,cent, more than she imported), and is, therefore, in tho position of always being able to command gold in settlement of her trade balances. During tho last three years, India’s surplus exports have amounted to £150,412,000, and her net gold imports to £71,245,000. Tho absorption of gold is, to some extent, due to the stoppage of tho free coinage of silver by the Indian Mints, and the gradual standardisation of gold in the Indian currency by making it, alternatively with the silver rupee, legal tender throughout tho Dependency; but, after, making due allowance for these factors, there is reason to think that a very large proportion of the Indian importations goes into private hoards and disappears from use. Some recognised authorities aver that immense sums of money lie buried in India. Be that as it may, it is certain that a large amount is annually absorbed there in tho manufacture of ornaments for personal adornment,. th© penchant of the Indian native for display in that . particular being well known. Unfortunately, the disposition to hoard is a failing not confined to countries such as India. European nations resort to it occasionally, especially in the face of; a national crisis,' such as the imminence of war. In tho recent critical state of international relationships, tho practice was freely resorted to in Europe. Tho President ,of the Imperial Bank of Germany, giving evidence before th© Budget Committee of the Reichstag a few months ago, remarked upon it, and stated that during tho last quarter of the year the withdrawals from tho Imperial Bank aggregated £25,350,000, whereas tho normal amount for the corresponding period in

previous years was about £2,750,000 only. The German Savings Banks, also lost some. millions at the same time, whereas, in ordinary circumstances, the Savings Banks deposits would have shown° a largo increase. There is reason to think, too, that a similar process was concurrently going on in Franco, but exact figures are not available. ’ X have gone into this subject thus fully in order that you may have a clear idea of tho main influences that have contributed to bring about tho present financial tension. I am 1 not without hopo that the re-establishment of peaeo on a firm and enduring basis may, in tho course of a few months, effect an improvement in the present situation and outlook. The restoration of confidence may bring about the release of the hoarded European millions, which will tlow again into the old channels and relievo the strain; but I am not sanguine of a speedy change, as the settling np of tho liabilities incident to the war will involve a heavy demand on credit supplies. It is satisfactory to note, however, that tho Bank of England, which had been under tne necessity of maintaining a 6 per cent, rato uniformly since October 17 last, was able to see its way, on April 17 last, to reduce its rate to 41 per cent. It is, as many of you no doubt know, a financial axiom tliat the price of investment stocks rises .as trade prosperity declines. The converse of this is, of course, equally axiomatic, and in a period of intense industrial activity, such as that through which. we have been, and are at present, passing, heavy depreciation in investment-stocks was inevitable. Tho “slump” in prices that has taken place has not been peculiar to British securities. Those of other countries have depreciated in an equal and in some cases even a slightly greater degree. For example, during 1912 German 3 per cents, fluctuated from 82 to 75, Prussian 3) per cents. 03 to 86, French Rentes 3 per cents. 95J to 88j, Austrian 4 per cents. 98 to 88, Russian 5 per cents. 106$ to 100, British Consols 2} per cents. 79 3-16 to 72J.

It will be seen from these figures that the margin of variation'in each case is. very nearly the same, showing that tho movement has been general.It has extended to stocks and bonds of all descriptions, and the aggregate of file depreciation represents a huge sum. Still, it is erroneous to treat the depreciation as a loss. It is not a lass except to those whose circumstances necessitate realisation, at this unfavourable juncture. The yield upon the investment, while held, remains tho same, and, peace being assured, and trade conditions becoming less active, tho market price* will almost certainly again advance. As far as this bank is concerned, full appropriation for tho deficiency disclosed by tho market quotation of all our London investments has been made. We-do not, however, look upon tho appropriation as lost money, but merely ns funds'held_ in 'reserve'. Our investments in securities of the character referred to arc mostly of , a permanent nature, and wo believe that, when financial' and political conditions change for tho better, there will he a recovery in prices. Leading financial authorities at Home entertain decidedly sanguine opinions in regard to the prospects of a substantial future , recovery. .With regard more particularly to British Consols, which wero the subject of some discussion at tho last Half-year General Meeting, it will probably interest some of you, and reassure others, to know that n , hopeful feeling prevails. In a recent article in a leading Loudon financial paper, which is a recognised authority in such matters, the writer advocates tho superiority of Consols over the securities of any other European State, and closes his: arguments with the following observation : , “Great Britain is the only Great “Power that is paying its way to“day: the only Power which is redeeming debt t out of revenue instead pf meeting expenditure out “of loans. \ So long as that remains “true, Consols—-other things being “equal—must have a greater recuperative power than tho securities of “other Governments.” Tho year has naturally been a most unfavourable one for tho flotation of Public Bodies loans. Many local authorities have been holding off 'the market in tho hope that an improvement in the conditions would enable them, before long, to place their issues at tho low rates previously obtainable. They have, however, so far been disappointed, ■ and while ivo have, since tho beginning of the year, successfully placed a few loans on behalf of leading Public Bodies, the rate of interest they have had to pay has been higher than, in ordinary circumstances, would have sufficed to attract all the funds they required. Tho loans handled by us have been as follows: — Auckland Harbour Board ... £250,000 at 5 per cent. Issue price, par. ' Auckland City Council £IOO,OOO at ii per cent. Issue price, par. Auckland and Suburban Drainage Board £IOO,OOO at 41 per cent. Issue price, £99. Auckland City Council £150,000 at 41 per cent. Issue price, par. Tho rates and terms of issue compare favourably with those accepted by municipalities in other parts ,of the world who have simultaneously appealed to the Loudon market for funds on lengthened loan. There is no prospect of an early improvement, in the attitude of the London market towards loans of Public Bodies. There is reason to fear that lenders, in sympathy with the persistent demand and the prices wdiich leading borrowers are prepared to pay for accommodation, have adjusted- their rates at a permanently higher scale. . . Early' in the year tho New Zealand Government concluded arrangements in London for the issue of a £3,000,000 4 per cent, loan of 30 to 50 years currency, Tho issue was made in February last, and although, in consequence of its having struck ' an unfavourable market, the underwriters were loaded with a considerable percentage of their' commitment, we understand that in less than two months the whole amount had been absorbed by bona fide investors. This speaks well for the, good reputation wdiich the Dominion’s securities enjoy in the London market.' The State Governments of tho Australian Commonwealth, in their own loan issues, have fared no better than ourselves. The underwriters of tho West Australian loan of £2,000.000, issued about the middle of April last, had to take up 87 per cent, of tho amount. During the first quarter of this year, 1 Australasia obtained in London £10,235,500, as against £1,642,800 in the om'ccsponding quarter of 1912, and £598,900 in 1911. Considerable difficulty has been experienced in raising the money, notwithstanding the higher rates ot interest offered, and in

most cases the underwriters have had to find, the bulk of the money. The severe monetary conditions in London have been reflected throughout tho world, as I have already pointed out, and if money is dear in New Zealand, it is dear also everywhere else. It is safe to predict that, while existing conditions continue, Australasia’s applications for loans in London will need to be upon a more favourable basis to the purchaser than was the case a few years ago. Tills should serve to “point a moral and adorn a tale.” It indicates pretty clearly the wisdom of the Governments of these lands initiating a more self-reliant policy in matters of. finance, undertaking only such development work as is distinctly remunerative, and appealing to the London market for the present as little as possible.

The activity in 'British trade and commerce, to which I have referred, is reflected in the prices of our produce. Practically all New Zealand products are selling at high prices, and it is to be feared tliat importers have based their ideas of requirements on these high export values. It, must not be overlooked that tho cost of production, tho cost of transport, , and the cost ot marketing have all increased, and while higher prices are being obtained for eur produce, the net return does not show any material addition to the purchasing power of the community. The values of the exports from and imports into New Zealand for the past eight years to March 31, 1913, are instructive. The figures (which are exclusive of specie in every case are as under;— Year ended Exports. Imports.' 31st March £ £

The imports for 1913 show an in- ' crease of £6,535,867 over those for 1910. That is the expansion in three years. Comparing the exports for the same period, there is an increase of only £1,175,878.; ; It must be admitted that • ■ the Dominion is bearing the strain of dear money better than many people anticipated. Tiie State finances exhibit a healthy condition. The Minister of Finance is able to show a surplus of about £700,000, which is practically the amount of the increase shown by the ordinary revenue. Domestic trade is not so active, as it was a -year ago, but still it cannot bo described as dull. AVith prudence, care and economy on the part of the people, wo shall weather the present financial stress without serious consequences. Settlement and development are proceeding on satisfactory lines. Quite a largo number of estates have been acquired for close settlement. According to .official figures, the estates purchased during the financial year ended March 31, 1913, comprised 50,819 acres, dis tribnted as follows; Hawke’s Bay 26,447 acres Canterbury 22,572 acres Otago 1,800 acres 50,819 Since the close of the financial year—that is, in April and May—a further 119,874 acres freehold and 90,786 acres leasehold have been acquired. The division of large estates for close settlement famst bring about —indeed, has already brought about —some changes in the pastoral industry. The tendency is now towards the production of Butter and Cheese, and the development of the dairy industry is a striking feature of New Zealand farming. So long as present high prices rule, tho industry will be popular, and wo may be sure that most of the estates that are acquired for close settlement will eventually he helping to expand the output ot the dairy industry. The result must inevitably bo to retard the growth ot. sheep farming. Consequently, it would appear that, notwithstanding the breaking-in of new lands in the'future, it us unlikely that our maximum sheep-carrying capacity -will exceed 25,000,000 head. This, roughly, would enable us to produce annually about 500,000 bales of wool and provide about 6,000,000 carcases of • mutton- and lamb for export. Closer settlement is also helping to develop the fruit industry. Although this industry is still very much in its infancy, giant strides have been made during the past four or five years, thanks to the zeal ot the Government Departmental experts. The indiistry is being developed on scientific lines, and I am optimistic enough to believe that New Zealand will, in the near future, take a very prominent place as an exporter of apples and other fruits. According to figures that I have been able to obtain from official sources, it is estimated that there are at present about 36.000 acres under orchard. Tho price of land for apple growing, before planting, varies from £5 to £IOO per acre, according to district. Areas of very suitable land are readily obtainable at £2O per acre. The average price of land, with trees in full bearing, is. from £l3O to £2OO per acre. During tho season of 1912, New Zealand exported between 16,000 and 17,000 cases of apples, and the prices realised in London ranged from 9s to 18s per case. Tho charges are cstimatMl at 5s 6d per case, and it is claimed that a net return to the grower of oven Id per lb. ■ gives a satisfactory profit. It is expected that about 30,000 cases this season will leave New! Zealand for South America alone, and there are other markets to be exploited.

Thd pending’ alteration: of the American tariff,, involving as it does, lower duties on some of our principal products—notably, wool, will almost certainly have a hardening influence on prices—to what extent it is of course impossible at present to say, the. tariff not being, as yet, fixed. Another approaching event which has in it the seeds of great, possibilities, is the nearing completion and opening to commerce of the Panama- Canal. What its effect will be on the trade of this Dominion I cannot at present pretend' to say. . Owing to the absence of trust-: worthy information and reliable data, no one can in the meantime gauge the prospects or the possibilities of the trade which , the completion -of the canal may open up, with North and, South America, hut I firmly believe that the establishment of this now trade route, will ultimately prove distinctly beneficial to this country. . Viewing the position as a -whole,, and notwithstanding the temporary inconvenience of dear money, I* am of opinion that the prospects before New Zealand are bright and promising. Given more workers and fewer shirkers, a respite from labour disturbances, and a sensible and reasonable co-operation of labour and capital, l ean see nothing to hinder her continued progress and prosperity.-

1906 .... ... 16,247,212 ' 12,667,902 1907 .... ... 19,434.658 14,717,2981908 ... ... 17,863,842 17,466,421 1909 ... ... 16,767,818 16,313,759 1910 ... ... .21,467,387 14,773,821 1911- ... - 21^497,187 17;S86,066 1912 .... ... 19,003,851 19.774,517 1913 .... ... 22,643,265 21,309,688