BANK OF NEW ZEALAND.

Stratford Evening Post, Volume XXXVI, Issue 43, 26 June 1913, Page 5

BANK OF NEW ZEALAND.

CHAIRMAN'S ADDRESS.

PROGRESS AND PROSPERITY

(Special to "Stratford Post.")

Wellington, June 26. At the Annual Meeting of shareholders of the Bank of New Zealand, held in Wellington to-day, the Chairman (Mr H. lieauchamp), in moving the adoption of the Report and Bal-ance-sheet, said:

You will have seen by the Report and Balance-sheet, recently distributed to shareholders, that the Bank has experienced another good year. The amount available for distribution, though not quite as large as for the previous year, is still very satisfactory, and the Board is able to recommend the payment of a dividend at the same rate as formerly, and the transfer of

£175,000 to the Reserve Fund. The position of the Bank, I am pleased to say, continues to be thoroughly sound, and its business iully maintained in all departments. In conformity . with out usual custom, I will refer briefly to the principal items in the balance-sheet.

Capital —The paid-up Capital remains the same as previously, namely £2,000,000. As indicated at the laßt half-year general meeting, the question of an increase in the Bank's capital has been engaging our attention. A recommendation on the subject has been made to the Government, and in due course no doubt a measure will be brought forward in the session of Parliament now about to open, embodying, we trust, proposals that will be fair and equitable to all the interests concerned. Until the views of the Government are made public, it would be premature for us to enter into any discussion on the subject. A committee,. acting in the interests of the ordinary shareholders generally, has called, for 4th July proximo, a meeting in terms of clause.; 79 of the Deed of Settlement for the purpose of considering the question from their own particular standpoint and arriving at resolutions on the subject, which will no doubt be communicated to the Government in due course. At that meeting you will have full opportunity for voicing your views on the subject. It is proposed, therefore, to limit the business of this meeting to the matters usually dealt with at an ordinary general meeting, leaving the capital question for discussion at the special general meeting called for 4th proximo. The Reserve Fund.— As already mentioned, the Board proposes to place £175,000 out of profits to- credit of this fund, making the total £1,'375,000 —a most satisfactory figure having regard to the fact that seven years ago the fund amounted to only .£81,294. With the balance proposed to bo carried forward (.£43,117), the reserve fund and undivided profits mil amount .to -£1,418,117. '"* h-Jt)--*

Notes in Circulation are less by £36,280 than at 31st March, 1912, and now stand at £994,680.

Daposits, (£16,414,639), exhibit., an increase of £580,772 on the figures of a year ago, mainly due to" large Government balances. Free deposits hare shrunk a little, but on the other hand fixed deposits, notwithstanding the high "Tales for side, have been well maintained, and in fact show a slight increase. The fixed deposit rates were raised, by :pnehalf per cent, during the year;" ' Bills Payable and pttier Llabilitfet, £1,367,081. There.is practically 'no variation in this item as compared with twelve months ago. '.i,Coin, Bullion, Money at short Cailf Etc.—Coin and cash balances,--'Sind'" bullion, together stand at £3,14g;93GV an increase of £44,417 as compared with the figures of a year ago, .Money at. short call, Government and other securities in London, also show art:'increase, the present figures (£4,081,038) being greater by £764,878 than at 31st March, 1912. Larger Government balances account for the major portion of this increase. The totals under above headings, together with the amount of bills receivable and investments in the colonies, are equal to 58.766 per cent, (or lis 9d in the £) of the total liabilities of the Bank to the public. Bills Receivable, in London and in transit, stand at £2,847,126, a n increase of £440,860, caused principally by an expansion in the value of the Dominion's exports.

Investments in the Colonies are less by £307,979 than at 31st "March, 1912. The transfer of some Colonial Government securities to London Office practically accounts for this decrease. Advances.—The remarks made in the Bank's report of twelve months ago apply also to-day. The monetary conditions then existing have not materially altered, and the Bank, while responding to <tho reasonable requirements of its customers, has necessarily adhered to a cautious and conservative policy in regard to advances.

Bills discounted, which now stand at £1,253,254, are more by £32,179, and other advances (£9,504,075) are* less by £163,673, than at 31st March, 1912. I may mention that the balances owing by Purchasers of Assets Realisation Board assets, having been reduced to comparatively small figures, are now included in 'Other Advances,' and the item therefore ceases to appear in the balance-sheet under a separate heading. Larder? Property and Premises— After appropriation now made of £40,000. this item stands at £467,827, as against £420,538 last year. This considerable increase has been, caused principally by purchase of land and premises at Sydney, and of a more central site in Palmerston North. The Bank already held another property iti Sydney, but the building was useless for banking purposes. In preference to erecting a new building there, the Board considered it advisable to take the opportunity of securing a site which offered in a more central position with suitable building already erected theroon. The former property is in the market for sale, and we expect to dispose of it shortly. The Palmerston 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 Bank's business having rendered such works necessary.

Profit and Loss—The net profits for th» yas.r, after paying the £40,000 in-

tefeit on guaranteed stock and making all neceßsary appropriations, including provision for the Bank's animal grant to the provident fund and the allocation of £40,000 in reduction of Bank premises and furniture accounts, amount to £302,530, as compared with £331,182 at 31st March, 1912. Adding the amount brought forward from last year (£-10,537) and deducting the amount of interim dividend at 6* per cent, paid in December (£60,000), the sum available for distribution is £283,117. Tho directors now propose to pay a further dividend of 6 per cent, and a bonus of 3 per cent, on ordinary shares (making 15 per cent, for the year) and a further 4 per cent, on preference shares (making 10 per cent, for the year). The distribution to shareholders will therefore amount to £125,000 for the year. As already mentioned, ifc is proposed to transfer £175,000 to the reserve fund, and to carry forward the balance, £43,117. The dividend and bonus will be payable in Wellington to-morrow, 27th instant, and at branches on receipt of advice. BOARD OF DIRECTORS. Mr J. M. Johnston, one of the Government Directors on the Board, retired at 31st March, tho term for which he had been appointed having eipired, and Mr J. H. Upton, of Auok'ai-d, was appointed in his place. The Board have passed a resolution appreciative of Mr Johnston's services. Mr tpton, as you are probably aware, is a well known and representative business man in Auckland, and I have much pleasure in introducing him to you to-day. Since we last met you, our late Chairman, Mr Martin Kennedy, has paid a visit to Europe. During hia stay in London he was associated with the Board there and has no doubt acquired valuable information connected with our London busings. Ho aas Just returned to Wellington, and I have pleasure in welcoming him lark. At the first meeting of the Boat! in April last, my colleagues did me the honor of electing me to the position of Chairman of the Board for the current year. LONDON BOARD.

We are much indebted to the members of the London Board for the caro which they have displayed in superyisitittg our expensive business at that point." We have to record with regret the death of Mr Eichard H. Glyn, for many years Chairman of the London Board. Those of you whose memories can recall the events of the early nineties, will remember that Mr Glyn became first associated with the Batik as President when the Head Office was transferred to London. When the legislation of 1894 effected transfer of the Head Office to Wellington, Mr Glyn's valued services were retained in the capacity of Chairman of the London Board, a position which he occupied until his decease. Mr Frederic Lubbock, who has been a Member ,of the London Board for feme years, has been appointed Chairman. ;n succession to Sir Glyn. Mr Lubbock is a! member of the well%own .backing, family of that name, and is a gentleman of large financial experience, holding a seat on the Boards of several London financial institutions. Our important London interests will, I am sure, be safe and 'prokr)eir6us under his capable guifiance.

STAFF. If would like to record my colleagues' ami my own appreciation of the great services accorded to the Bank during thri past, year ,by the London, Australian, Fiji and staffs. To, our general manager (Mr Wm. Calender) and to our London manager (Mr A. Kay) our thanks are especially due for the able and conscientious manner in which they have carried out their onerous duties. ' GENERAL REMARKS. It will, no'doubt, be expected of me that I should make some remarks with' regard to the present fiiianci.il and commercial conditions. Unquestionably, stringent monetary conditions continue to prevail, and are more accentuated than on the occasion when we last met you. "The causes of the existing tightness are, in'the main, not local but general, and it is because of the nature of the circumstances that have produced them, and the extent of the area over which the causes are operating, that I am not too sanguine of an early return to easier conditions. An exceptional feature influencing the European money markets during the last few months has been the war in the Balkans, conjoined with the political uncertainties Which that war has involved. As a consequence, each of the great European Powers has been making strenuous endeavours to strengthen its own financial opposition, and to obtain the control of gold supplies so as to prepare as effectively as possible for the contingency of itself becoming involved in hostilities. At London, Paris, Berlin and Vienna, high Bank rates have consequently been ruling for taany months past with that object in view. A review of the 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 war's that have taken place since the commencement of the 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 the finances of some who are bent upon persisting in the race for naval and military supremacy. Other nations are also coming into the field. Turning to the East, we see Japan taking her place as 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 off the lethargy of centuries, and displaying a disposition to follow the lead of her island neighbour. Her call 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 the world. These are considerations of'.national and political significance to which the financial barometer is keenly sensitive. They constitute in themselves a situation sufficiently disturbing to account for a large 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 d«lporable 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 the civilised world, involving a very strong demand for capital supplies to finance manufacturers and production. The steadily improving social conditions of tho world and the higher standard of living which is now being generally adopted may also be set down as among the originating causes of the scarcity of money. Then there is' the assimilation of western ideas that is going on among the eastern nations of the world, and the resulting tendency to frame the requirements of life—individual and social—on the basis of western models. But perhaps more important and weighty than all these, is the heavy perennial demand arising in connection witli tho colonisation and development of the unoccupied lands of the.world —work which, year by year, goes on in continually increasing volume. Apart from the natural increase of population occurring yearly in the new world, and the 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 tho new lands across the Atlantic. Discontented with tho existing conditions of life and labor in the lands of their birth, and despairing of improvement, the European peasantry are in ever increasing numbers migrating to the American Continents. Attracted and encouraged by the experiences of the earlier settlers, their exodus to the West assumes every year larger and yet larger proportions. In a small way, we 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. Tt may, however, assist in emphasis-i ing the point to mention that, during tho year 1912, the immigration into Canada reached the large aggregate of nearly 395,000 persons, shoeing an increase cf over 13 per cent, on the total for 1911, which was itself a record year. The call for capital to assist 'in-settling this large population in its new home, and to furnish it with the means of earning its subsistence, is in itself enormous. Daring the year 1912, nearly £47,000,000 of the new capital issues on tho London money market were on Canadian account, and over £20,000,000 on account of the Argentine. It will be readily seen how fertilo a channel this is for the drawing off of surplus supplies or" British and Continental capital, t ■

In sympathy with the increased activity of industry, the volume of British trade shows a large expansion, the totals for 1912 having reached the enormous aggregate of £1,344,169.003, the 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 June, 1909,' continuous quarterly trade increases have taken place. The "boom" in that great industry, ship-building, which commenced some time ago, is fully maintained, and nothing points to an' early decrease in activity. In this connection, I may mention' that on the 31st March last, there were 563 vessels, aggregating 2,003.700 tons, under construction, as compared with 545 vessels, totalling 1,680 900 tons, in the corresponding quarter of 1912. It is natural to expect that, in tho circumstances, the appeal to the London market for the capital to finance such a huge 1 volume of bxfsifhess would bo extensive. As a matter of fact, tho capital issues on the London market in 1912 reached the largo total of £210,850,000—an increase of £19,090,000 over the figures of 1911. The amount is, of con '-so, far short of the figures for 1910, w'len £267,439,000 was raised on tho Loudoll market—an altogether abnormal sum: so much so that the business was clearly overdone and the future heavily discounted. The ''slump" which subsequently occurred (and f ,- orn the effects of which wo are even now still suffering) is undoubtedly attributable to the excessive amount of this class of business at that time undertaken. The combination of adverse influences above mentioned, operating at one and the same i ; me. have constituted a drain upon the financial resources of the world Mat has been stupendous, and the marvel is not that there has been financial stringency, but that the stringency has not borm much more pronounced. The world's gold production shows steady expansion .in recent years. In 1912 the output was the highest on record about £97,000,000; and it has trebled within the last twenty years. Nevertheless, the growth is in no sense commensurate with the increased credit requirements, and there is reason to fear that, at the present time, the available gold reserves forming the basis upon which the huge superstructure of credit rests, are quite inadequate. Tho efficiency of the existing supply of tho precious metal is, to a considerable extent impaired by the tendency on tho part of some nationalities to hoard—a disposition to prefer the possession of tho gold to the command of tho credit which the gold can secure. At the present time, the most persistent call upon the gold reserves of the world is from India—a country which, with comparatively light external indebtedness, exports yearly a largo 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 trado balances. During the last three years, India's surplus exports havo amounted to £150,112,000, and her net gold imports to £71,2-15,000. Tho absorption of gold is, to somo extent, due to the stoppage of tho free coinage of silver by the Indian Mints, and tho gradual standardisation of gold in the Lidian currency by making it, alternatively with tho silver rupee, legal tender throughout tho Dependency; but, after making duo 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. Bo that as it may, it is certain that a largo amount is annually absorbed there in tho manufacture of ornaments for personal adornment, the 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; es-. pecially in the face of a national crisis, such as the imminence of Avar. In tho recent critical state of international relationships, th» practice was freely rsaorted to in Europe. The Presi-

dent of the Imperial Bank of Germany, giving evidence before tho Budget j Committee of the Eeichstag a few months ago, remarked upon it, and j stated that during the last quarter cf the year the withdrawals from the Imperial Bank aggregated £25,350,000, whereas tho normal amount for jthe corresponding period in previousi I years was about £2,750,000 only. The i German Savings Banks also lost somej | millions at tho same time, whereas, in I ordinary circumstances, tho Savings! I Banks deposits would have shown a; [largo increase. There is reason to, think, too, that a similar process was concurrently going on in France, but! exact figures are not available. I have gone into this subject thus; fully in order that you may have a. \ clear idea of the main influences that have contributed to bring about the i present financial tension. lam not without hope that tho re-establish-! ment of peace on a firm and enduring basis may, in the course of a few i months, effect.an improvement in the present situation and outlook. The restoration of confidence may bring: about tho release of the hoarded Euro-; pean millions, which will flow again! into the old channels and relievo the j strain; but I am not sanguine of a speedy change, as the settling up ofj the liabilities incident to tho war will j involve a heavy demand on credit sup-; plies. It is satisfactory to note,] however, that tho Bank of England,! which had been under the necessity i of maintaining a 5 per cent, rate uni-i formly since 17th October last, was able to see its way, on 17th April last, j to reduce its rate to 4J per cent. It is, as many of you no doubt know, a-financial axiom that 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 ' wo have been, and are at present, j passing, heavy depreciation in investment stocks was inevitable. Tli9| "slump" in prices that has taken plaice! has hot been peculiar to British sccu-! ritics. Those of other countries have j depreciated in an equal, and in some cases even a slightly greater degree. For example, during 1912 German 3 per cent.

fluctuated from ... 82 to 75 Prussian per cent ... 92 to 86 French Rentes 3 per cent 95J to 88£ Austrian 4 per cent ... 98 to 88 Russian 5 per cent. ... 106 fto 100 British Consols 2.J per cent. 79 3-16 to 72-} It will bo seen from these figures that the margin of variation in each case is very nearly the same, showing that the movement has been general. It has extended to stocks and bonds of all descriptions, and the aggregate of the depreciation represents a huge sum. Still, it is orroneous to treat the depreciation as a loss. It is not a loss except to those whoso circumstances necessitate realisation at this unfavourable juncture. The yield upon the investment, while held, remains the same, and, peace being assured, and trade conditions becoming loss active, the market price will almost certainly again advance. As far, as this Bank is concerned, full appropriation for the deficiency disclosed by the market quotation oi all our London investments has been made. We do not, however, look upon the appropriation as lost money, but merely as funds held in reserve. Guy investments in securities of the character referred to are mostly of a permanent nature, and we believe that, when financial and political coni ditions change for the better, there will lie 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 were the subject of some discussion at the last half-year general meeting, it will probably interest some of you, and reassure others, to know that a.hopeful feeling prevails. In a recent article in a leading London financial paper, which is a recognised authority in such matters, the •writer advocates the superiority oi 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 Bower which is "redeeming debt out of revenue "instead of meeting expenditure "out of loans. So long as that "remains true, Consols—other "things being equal—must have a ."greater recuperative power than "the securities of other Govern"ments."

The year has naturally been a most unfavourable one for the flotation of public bodies loans. Many local authorities have been holding off the market in the hope that an improvement in the conditions would enable them, before long, to place their issues at. the low rates previously obtainable. They have, however, so far been disappointed, and while wo have, since the beginning of the year, successfully placed a few loans on beliall 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 tin l funds they required. The 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 4i per cent. Issue price, par. Auckland and Suburban Drainage Board £IOO,OOO at 4J per cent. Issue price, £99. Auckland City Council ... £150,000 at 4} per cent. Issue price, par.

The rates and terms of issue compare favourably with those accepted by municipalities in other parts of the world who have simultaneously appealed to the London market for funds on lengthened loan. There is no prospect of an early improvement in the attitude of the London market towards loans to public bodies. There is reason to fear that' lenders, in sympathy with the persistent domain' and tho prices which leading; borrowers are prepared to pay for accommodation, have adjusted their rates at a permanently higher level. Early in the year tho New Zealand Government concluded arrangements in London for the issue of a £3.000,000 I- per cent, loan of 30 to 50 year? currency. The issue was made in Felirurary ]*»st, 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 has been absorbed by bona fide investors. This speaks well for the good reputation which 'the Dominion's securities enjoy in the London markat. The State Governments of the Aus

tralian Commonwealth, in their own loan issues, have fared no better than ourselves. The underwriters of the West Australian loan of £2,000,000, issued about the middle of April last, .had to take up 87 per cent of the amount. During the first quarter of this year, Australasia obtained in London £10,235,500 as against. £1,642,800 in the corresponding quarter of 1912, and £598,900 in 1911. Considerable difficulty has been experienced in raising the money notwithstanding the higher rates of interest offered, and in most eases the underwriters have had to find the bulk of the money. The severe monetary conditions in London have been reflected throughout the 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 basks to the purchaser than was the case a few years ago. ' This 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 Xew Zealand products are selling at high prices, and it is to he feared that importers have based their ideas of requirements on these high export values. It must not be overlooked that the cost of production, the cost of transport, and the cost of marketing have all increased, and while higher prices are being obtained for our 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 vears to 31st March, 1913, are instructive. The figures (which are exclusive of specie in every case) are as under:—

The imports for 1913 show an increase 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. The 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 be described, as. dull. With prudence, care and .economy on the part of the people, ; we shall weather the present i'inanciaj stress without serious consequences. Settlement and development are proceeding on satisfactory lines. Quite a large number of estates have been acquired for closer settlement. According to official figures, the estates purchased during the financial year ended 31st March, 1913, comprised 50,819 acres,. distributed as follows: Hawke's Bay ... 26,447 acres Canterbury ... 22,572 " Otago; ~''... .f.«w»lJ800 " i *, [; ::r: or •"••»' ! 50,8i9

Since the close of i 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 must 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, the industry will be popular, and we may be sure that most of the estates that are acquired for close settlement will eventually be helping to expand the output of the dairy industry. The result must inevitably be to retard the growth of sheep farming. Consequently, it would appear that, notwithstanding the breaking-in of new lands in the ■future, it is 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 0,000,000 carcases of mutton and lamb for export. Closer settlement is also helping to develop the fruit industry. Although this industry is stiil very much in its infancy, giant strides have been made during the past four or five years, thanks to the zeal of the Government Departmental experts. The industry 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 1 have been able to obtain from official sources, it is estimated that there arc at present about 36,000 acres under orchard. The 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 ivith trees in full bearing, is from £l3O to £2OO per acre. During the season of 1912, Xew Zealand exported between 16,000 and 17,000 cases of apples, and the t prices realised in London ranged from 9s to 18s per case. The charges are estimated at 5-6 d per case, and it is claimed that a net return to the grower of even 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.

The pending'alteration of the American tariff, involving as ifc 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 trustworthy information and reliable data, no otic can in the mor<ni;:' l if' flange th© prospects or the possibilities of the trade which the completion

of the Canai may open up, with North and South America, but 1 firmly believe that the establishment of this new 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, I can see nothing to hinder her continued progress and prosperity.

xear ended Exports Import?;. 31st March £ £ 1006 . 16,247,212 12,637,902 1907 . 19,434,658 14,717,298 1908 . 17,863,842 17,466,421 1909 . 16,707,818 16,313,759 1910 . 21,467,387 14,773,821 1911 . 21,497,187 17,385.006 1912 . 19,003,851 19,774,517 1913 . 22,643,265 21,309,688