A.—3.

Trade Prospects. Rarotonga. I have already answered the statement that has been made to the effect that export of fruit is declining, and have proved that the official records show that the contrary is the case. There are, however, other remarks that require explanation. It is urged that the Government should stamp out all blight, and plant young orange-trees. This advice may be sound, but there are certain preliminaries that require attention before anything can be done. The assent of the small landholders would certainly be required, also an expenditure of £20,000, and the result would be the destruction of the orange trade. The orange-trees of Rarotonga are not planted in neat rows or in small orchards, but are to be found here and there, scattered over a surface of at least 5,000 acres. Even in the deep mountain ravines they may be found, and it is from such places that we get our best fruit. If this blight is to be stamped out, all of these trees must be cut down, and that is an operation to which the Island Council will never give their consent, inasmuch as they will naturally be governed by self-interest and a very large knowledge of the requirements and circumstances of the island. It is about eight or nine years since the black aphis became a nuisance and danger to the fruit of Rarotonga; but since that date there has been a gradual improvement, and the aphis is no longer a danger. If we have a very dry season this pest makes its presence felt, but under ordinary conditions we are hardly aware of its existence. The aphis has probably developed its own enemies, and that it has done but little harm for some years is manifested by the fact that our exports have not fallen off. It is not any insect-pest that kills off the orange-trees of this island so much as the opening-up of the forest. The orange requires both shade and moisture in the tropics, and if the wind or sun is allowed to dry up the moisture from the roots of the trees, they are then unable to resist thp aphis or any other blight. As for planting young orange-trees, I may say that Messrs. Connal and Shearman have both experimented, the former planting 50 acres, and it has been found that the local orange will do very well planted in the open when cocoanut-trees have grown sufficiently to give them shade; but the imported varieties have nearly all died out. It is manifest that the export of oranges from these islands will not be materially increased unless there be greater certainty in the matter of returns, for it can hardly be expected that planters will devote their energies to develop an unprotected export for which they frequently receive debit notes only. The crop of the present year will probably be only three-fourths of that of the previous year, but the value to the group may prove to be about the same, though last year's prices were the best known for many years. The cultivation of the banana is our chief industry, and I have reason to know that if this fruit is carefully handled and packed it will pay fair returns. From individual Natives but little can be expected in the way of improved methods of selecting or packing fruit, but the best men among them are now forming small companies, who pride themselves on sending away only the best articles, and are apt to boast of the money-value of the name they thereby acquire. This assumption of superiority will have a far-reaching effect, for if there is one thing that the Native of these islands does not love it is his Polynesian brother. The companies are increasing in numbers, and will compete one with the other in the New Zealand market. Mangcna. The trade of this island is not likely to be materially increased in the future, though the inhabitants are the most industrious of all the South Sea communities. The interior swamps of this island produce taro, the best of food, in abundance; the people are therefore well fed; but in no other sense can it be said to be a productive island. Whatever prosperity Mangaia may enjoy is due to one man—Daniela Tangitoru; and to the Union Company, who have encouraged the people by calling at Oneroa every month en route from Tahiti to Rarotonga. To the example of Daniela is due the comparatively large export of kumara to New Zealand during the temporary failure of the potato-crop. All exports from Mangaia are the result of sheer hard work, and every .pound exported has to be carried on men's backs from the fertile land on the Makatea to the canoes. Their exports, shown on Schedule C, are not likely to be exceeded during the next ten years, and they will have to work very hard to maintain the position to which they have now attained. In Raratonga the people have only to plant the banana and nature does the rest; but in Mangaia that valuable plant needs continual care and cultivation. Mauhe and Atiu. The first-named of these islands has now been surveyed, and the land cut up and awarded to the numerous families, in accordance with the evidence given. The security of tenure which will be the result of these awards will probably be favourable to increased production in this very fertile island, for hitherto men have not dared to plant. The words spoken by the chief Tararo in the Court are significant, and disclose the position of the small landholder previous to the sitting of the Court. I had found it necessary to comment strongly on the fact that men had held large pieces of land suitable for the growth of cocoanuts, but had failed to plant it or make any use whatever of it. Tararo defended his people, and said, " The only security a man had in the old days was to leave his land as nearly as possible waste; if he improved it he would arouse the cupidity of some powerful neighbour, who would set up a claim of overlordship, and declare the industrious man to be his tanu kai (workman), who had failed to bring in the customary

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