H.—2

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to keep up freights, whilst in Sydney there are opposing steam-lines. What we want is the P. &0. to come here and cut things down a bit. Why, we pay £1 10s. more a ton in freight alone for some of our goods than Sydney." Now, whilst this Commission has nothing to do with freights, it has with drawbacks, and perhaps, for the benefit of the whole colony, Auckland's shipping charges. I would therefore ask, sir, to take carefully these drawbacks into your consideration when you go to Auckland, and to recommend Parliament to allow the greatest liberality with respect to them in future. Do not, however, pay too much attention to what the Auckland merchants say. They are an excellent class of men, but they appear to me to consent far too readily to San Francisco and Sydney cutting them out in trading matters. They must fight tooth and nail for New Zealand's tropical trade, and if they do so our "potato and onion" will stand good to them in the struggle. I look to the people of Auckland to push our outward trade, and not to give in to any opposition. And this matter is of more importance than at first sight it appears. By the late alteration in the Union Steamship Company's steam route a monthly steamer leaves Auckland for Tonga, Samoa, Fiji, and Sydney, whilst the returning monthly steamer leaves Sydney for Fiji, Samoa, Tonga, and Auckland. The general opinion now is that the lower Sydney prices must mean the complete wiping-out of our commerce in this direction—for example, a trader in Tonga, as a trial, within the last few months sent a duplicate order to Sydney and to Auckland. The price quoted in Auckland for the whole order was £25, whilst the Sydney price was only £15 17s. 6d. Drapery and ironmongery, too, are far cheaper in Sydney than in Auckland. Kegged meat, lis. 6d. in Auckland, 9s. in Sydney. Flour from Adelaide and Melbourne landed £2 a ton cheaper everywhere. Whilst, therefore, I wish every liberality granted in the shape of drawbacks, I do blame Auckland merchants for not quoting lower prices. In my opinion, they can do so if they like. The Commission certainly might consider the advisability of the colony's relieving Auckland of its harbour debt, so as to allow island shipping as cheap port charges there as it finds in Sydney. We cannot blame the Union Steamship Company for throwing the trade into Sydney, because, if that company's vessels had not agreed to run as they are running, Sydney would have put on her own steamers. All I trust is, for the preservation of our island trade, that, until New South Wales treats us fairly, the Union Steamship Company will not throw any more advantages into Sydney's" way. For even in potatoes and onions Sydney can compete with us. Sydney employs now the very smartest commercial travellers she can get among the islands. The "potato and onion" question is really a very vital one. It is generally admitted in the tropics that New Zealand can grow good potatoes, onions, maize, &c, and that the people there can rely upon their keeping-qualities. For four months in the year San Francisco sends them potatoes and. onions ; for eight months they have to rely upon New Zealand. But if Sydney is going to monopolize all other branches of trade, our supply of farm produce must languish, and perhaps die out. Of course, in a year of drought New Zealand would come in, as she would in Australia itself; but, if Sydney is going to take the general trade, Sydney will also supply potatoes and onions. Now, Ido not think that the Sydney potato and onion (I use these two words by way of example for all our farm produce) are of such good keeping-properties in the tropics as the New Zealand articles; but I desire to point out to the Commission the vast extent of the neighbouring tropical market, so that in framing its report to Barliament the Commission may encourage our outward trade in those things in which it is acknowledged we can beat Sydney—namely, potatoes, onions, bulbs, cheese, hams, bacon, jams, oats, preserved milk, &c. I particularly wish to emphasize this point, for if the Commission looks at it as I do it will do the very best thing it could do to encourage and make prosperous our small-farm settlements. And I would say something here to the New South Wales farmer: that it is no use his sending a bad-keeping quality of these things to the tropics, else San Francisco will get the trade. Therefore I should like to see the Sydney people import free our New Zealand productions for their eastern tropical trade. We produce the best; therefore let them sell the best, and cut out San Francisco. Attached is a map,* upon which I have roughly marked the outward trading routes that I wish to see encouraged. I will name them as follow: (1) Auckland to Tonga and Samoa ; (2) Samoa to Rarotonga and Tahiti; (3) Samoa to the Union Group, Ellice Island, the Gilberts, Wallis Island, and other interinsular neighbouring islands; (4) Auckland to Fiji; (5) Fiji (interinsular, collecting) ; (6) Fiji to Vila (New Hebrides), and on to the Solomon Islands ; (7) Auckland to Noumea and Brisbane ; (8) Brisbane to Java, Singapore, Calcutta, or Bombay (unless with horses, when direct from New Zealand); (9) Brisbane to New Guinea, the Philippines, Hongkong, and Japan; (10) New Guinea (interinsular), and to the Carolines and Ladrones ; (11) New Zealand to Adelaide and Western Australia. Perhaps, for the information of Parliament, and for any tariff concession, after due inquiry, you may deem it advisable to recommend herein, your Commission would have a similar map prepared. The steamers would, of course, collect cargo from a far greater number of islands and places than I have marked out upon this map. My object in going to the Philippines (Manila) is to bring back a supply of manila fibre to mix with our own flax fibre. I can see no reason why we could not then, from New Zealand, supply to the neighbouring eight hundred million people (whose countries I have referred to above) a fair rope for their shipping and boating purposes, just as well as Europe now supplies them. The number of small craft used upon these coast-lines is surprising. I can see little use in shipping these fibres Home, half-way round the earth, only to be brought back again in the form of rope. I think that New Zealand might cultivate to the utmost this special branch of trade, and supply the whole of the Australasian Colonies too with a good rope. The following rough table of distances I have obtained for your guidance : Auckland to Noumea, 1,055 miles ; Sydney to Noumea, 970 miles ; Noumea to Brisbane, 795 miles ; Noumea to Fiji, 790 miles ; Fiji to Samoa, 650 miles; Samoa to Barotonga, 840 miles; Barotonga to Tahiti, 700 miles ; Samoa to Tahiti, 1,200 miles; Auckland to Tonga (Nukualofa,), 1,100 miles; Nukualofa to Haapai (Tonga), 132 miles; Haapai to Vavau (Tonga), 82 miles; Vavau to Samoa, 345 miles; Auckland to Barotonga (direct), 1,700 miles; Auckland to Fiji, 1,157 miles; Noumea to Vila (New Hebrides), 293 miles; Vila to San Christoval (Solomons), 760 miles; Apia to Wallis Island, 270 miles; Wallis

* See Appendix.