The Dominion THURSDAY, AUGUST 18, 1921. EMPIRE TRADE

Dominion, Volume 14, Issue 278, 18 August 1921, Page 4

The Dominion THURSDAY, AUGUST 18, 1921. EMPIRE TRADE

Q The conditions of current interImperial trade which were discussed yesterday at a special meeting of the New Zealand Association of British Manufacturers and Agents manifestly offer great scope for improvement. The whole Enipire is interested in rectifying a state of affairs in which foreign competitors have captured a considerable share of th© trade formerly dona by the Mother Country with he own Dominions and dependencies. Tn this country it is, of course, generally agreed that every effort ought to bo made to foster inter-imperial trade, so that the ground lost as a result of the war may be not only regained but extended. It is at the same time fairly clear that this object must be pursued in other ways than by, heavily increasing Customs duties on foreign goods. , The present unsatisfactory position has arisen in spite of the fact that in her trade with other parts of the Empire Britain in one wa.y and another already enjoys a very substantial preference over foreign competitors, and more particularly over her chief competitor, th© United States. Foreign; goods entering th© Dominions ar© subject to special charges which in this country range as high as twenty per cent., and so far as the United States is concerned, Britain is favoured to a still greater extent by th© present state of foreign exchange. With exchange on New York at its present level, a protective tariff of about 25 per cent, is in effect raised against American goods entering British markets. In this country preferential duties and exchange give Britain an aggregate preference over the United States amounting in some cases to 45 per cent.

These familiar facte plainly demonstrate that it is not for want of preferential treatment that Britain has for the time being lost ground in her export trade to this country and other parts of th© Empire. It is, of course, true that as a result of the changes brought about by the war she is faced by intensified competition in both interImperial and foreign trade, but a policy of prohibitive tariffs offers no hopeful solution of the problems raised in this way. Such a policy is nowhere less in favour than in the United Kingdom itself. The ruling tendency in Britain is, as it has been, towards unrestricted freedom of trade. Th© Safeguarding of Industries Bill is a measure of limited scope intended in part to protect industries which are vital to th© national security in the event of war, and in part to offset the effect in trad© of the abnormally low rates of exchange ruling in European countries. Imperial preference as it has taken shape in the United Kingdom is on a very modest scale. Britain is bound to shape her trade policy with duo regard to the fact that she must sell coal and a proportion of her manufactures, and obtain part of her food and raw materials from countries outside the Empire. An attempt by the Dominions to completely exclude foreign goods would be more likely to add to the difficulties of the Mother Country' than to assist her in recovering the share of world' trade she held before the war. The true line of progress is to bo found in a policy of united co-operation between the different countries of the Empire which will broaden the basis of inter-imperial trade. Preferential duties will serve a limited purpose, but the systematic improvement of inter-imperial transport communications and the effective mobilisation and application of British capital in the development of the Empire will pave til© way for an indefinite expansion of inter-imperial trade. By devoting an increasing share of her surplus capital to productive investment within the Empire Britain will be able gradually to reduce her present dependence on trade with foreign , countries. The improvement of shipping services is also of cardinal importance. If they are to servo their purpose, measures to build up trade within the Empire must be in the fullest sense mutual. In return for the tariff preference they freely accord the Mother Country, the Dominions are plainly entitled to ask for her whole-hearted co-operation in rectifying the unsatisfactory position in regard to shipping services which Mr. Massey has freely criticised during his present visit to London. As the Prime Minister has said, shipping charges on New Zealand export produce are undoubtedly higher than th©y ought to be. Purposeful united action by the Mother Country and the Dominions in this matter and generally in forwarding the development of the Empire will do much to stimulate inter-imperial trade.