H.—44

With the direct shipping services to these Eastern countries the trade should increase, and it is pleasing to record the growth in exports to the Dutch East Indies from £1,894 in 1936 to £4,035 in 1937. The trade, while still small, is more than double that of the previous year. The marketing of apples in the territory is being pursued, and good work is being done by our honorary representatives stationed in the East. TRADE WITH JAPAN. Total trade with this country is given in Table XXYII below, and it is noteworthy that, with the exception of 1935, there has been a surplus of exports over imports for the last four years. This surplus reached £1,502,007 in 1937, the year under review.

Table XXVII.—Total Trade with Japan.

Imports from Japan comprise a wide range of manufactured and semi-manufactured goods, the major ones being silk and artificial silk piece-goods, £431,618 (£416,005) ; cotton, linen, and canvas piece-goods, £265,730 (£268,884) ; and sulphur, £131,522 (£66,626). Exports of the principal items are shown in Table XXVIII below : —

Table XXVIII. —Principal Exports to Japan.

From this table it is seen that wool dominates our export trade with Japan and shows an increase over 1936 by £1,440,110. Other items entering the trade all show increases, with the exception of frozen meat. The direct shipping services have maintained regular sailings throughout the year, and no doubt this has assisted considerably in the growth of trade not only to Japan, but to certain other Eastern countries. TRADE TREATIES. The year under review marks a most important one so far ds the conclusion of trade arrangements with overseas countries is concerned. Following upon discussions which the Hon. Mr Nash had with foreign Governments during his visit abroad, trade arrangements have been made with the countries mentioned below :— The Netherlands. —An arrangement on a most-favoured-nation basis was concluded with the Netherlands, and came into effect on the 14th January, 1938. Under this arrangement duties on a limited range of goods imported from the Netherlands were reduced, and the Netherlands agreed to the importation of a quantity of fresh apples not exceeding 1,400 metric tons at the reduced monopoly fee of 2 cents per gross kilo during the period Ist March to 30th June, inclusive, in each year. The Netherlands also agreed to grant a quota for the importation of 1,000 metric tons of raw animal-fat per annum. Switzerland. —A trade arrangement was concluded with Switzerland on a most-favoured-nation basis, duties being reduced on a limited range of articles, including certain machinery, metals, pipes, medicinal preparations, &c., being the product of Switzerland. Switzerland agreed to the importation of a quantity of apples and pears not exceeding 1,500 metric tons. Germany. —A trade and payments agreement was concluded with Germany, and became effective on 12th October, 1937.

15

I Exports. ( Imports. I Percentage of Excess of Imports | I I Total Imports. over Exports. £(N.Z.) £(N.Z.) £(N.Z.) 1932 .. .. .. .. 236,799 478,000 1-9 241,201 1933 .. .. .. .. 354,462 677,000 2-6 322,538 1934 .. .. .. .. 856,014 836,000 2-7 20,014* 1935 .. .. .. 432,000 1,100,150 3-0 668,150 1936 .. .. .. .. 1,554,837 1,328,199 3-0 226,638* 1937 .. .. .. .. 3,131,986 1,629,979 2-9 1,502,007 ! * Excess of exports over imports.

1934. 1935. 1936. 1937. £(N.Z.) . £(N.Z.) £(N.Z.) £(N.Z.) Wool .. .. .. .. 689,851 241,697 1,265,836 2,705,946 Casein .. .. .. .. 92,342 128,667 142,124 173,257 Tallow.. .. .. .. 24,424 8,536 49,865 60,082 Butter.. .. .. .. 2,419 446 469 24,928 Hides, pelts, and skins .. .. 21,222 27,016 48,376 54,300 Scrap metal .. .. .. 18,418 18,990 24,870 56,727 Frozen meat .. .. .. .. 377 10,131 8,323