A.—4.

country like Holland, and assume for the sake of argument that Holland offered these advantages, thereupon Canada would be compelled to give the same terms to Holland that she now offers- to the Mother-country. She would then be bound by most favoured nation treaties to give the same terms to practically every important commercial country in the world. It would be, I think, a matter of impossibility to denounce those treaties, because that involves the whole trade of the Empire, and in some cases there is no term of denunciation in the treaties. " But, of course, the whole difficulty can be avoided—l only point it out in passing—the whole difficulty can be avoided by any colony which desires to make the preferential arrangement with the Mother-country if that colony will confine its offer nominatim to the Mother-country and not make it to a foreign country, but if it is offered to a foreign country, then, as I say, it will be. controlled by the most favoured nation treaties throughout the world. Pacific Cable. " The next point to which I will allude very briefly in connection with our commercial relations is the question of improved communications. That was the subject of very important resolutions at the time of the Conference at Ottawa, and already I am happy to think that considerable effect has been given to those resolutions in regard to the fast mail-service, which was the first and, probably, the most important of those resolutions. Arrangements are now in progress by which it will be accomplished, and I hope that, in connection with that, the service between Canada and Australia will also be improved, and there will be nothing further to be desired. "There is, however, still pending the question of a Pacific cable passing entirely through British territory. Upon that we desire to have the opinions of the gentlemen present as to how far they are prepared to go. I would say in regard to this, and also in regard to the fast steamservice, in dealing with the matter at all we are giving the most striking proof we can of our goodwill and of our desire to meet your wishes. Neither of these proposals would have been made by us. I must frankly say that we are not dissatisfied with the present arrangements ; we do not feel, although we think that they are valuable proposals, yet we do not feel that they are urgent, and therefore we should not ourselves, or by ourselves, have been disposed to offer subsidies either to the steamboat service or to the Pacific cable, and we are only induced to do it by our desire to show that in any matter in which our colonies are themselves deeply interested they may count upon the support and assistance of the Mother-country. Well, in regard to the Pacific cable, the matter stands thus : A representative committee was appointed, which has discussed the whole subject; it has come to the conclusion that such a cable is practicable, has roughly estimated the cost (which is probably less than was originally anticipated), and has also estimated the probable returns. What remains, however, to be inquired into is as to the subsidies which the several colonies are prepared to give towards this undertaking. Without in this venturing to pledge my colleagues, I say that to any proposal which may be-made by the colonies, the Government will give their most favourable consideration. Imperial Penny Postage. " I also should mention the desire which is widely felt, and which I share, for an improved postal communication with the colonies. I believe that that matter rests entirely with the colonies themselves, and that they have revenue difficulties in the matter which have hitherto prevented us coming to any conclusion. But I confess that I think that one of the very first things to bind together the sister nations is to have the readiest and the easiest possible communication between their several units, and as far as this country is concerned I believe we should be quite ready to make any sacrifice of revenue that may be required in order to secure an universal penny post throughout the Empire. Commeecial Code. " A very desirable but minor point would be, if it were possible—and I do not think that there is any serious practical difficulty—an agreement as to a commercial code for the Empire. We all know that trade relations are guided very much by the simplicity with which they can be conducted, and, if we had throughout the British Empire the same law in regard to all commercial matters, I have no doubt whatever that that in itself would be a strong inducement that the course of trade should take the direction that we desire. This, however, is a matter of detail; I should only desire an expression of opinion as to the desirability of it, but, if it were thought really a desirable thing to accomplish, it might be secured by an expert Commission, which would settle the details, and I think I have already circulated to the Premiers a memorandum on the subject which has been prepared by the parliamentary draftsmen of this country, and which would be the basis for discussion by any Commission which might be appointed. • Load-lines. " A difficulty has arisen, which is local I think to Australia, with regard to the settlement of load-lines. The settlement of load-lines has been undertaken in this country with a view tosecuring the safety of ships at sea, and of the men who go down to the sea in them, and a load-line has been established for the United Kingdom. It would be absolutely impossible for the United Kingdom, as long as that is in force, to recognise any other load-line less safe than their own, because otherwise it would lead to a transfer of trade. It would be perfectly natural if a shipowner wished to escape the obligations of .the law to transfer himself to a colonial registry, and to come into competition with our shipowners with arrangements which, although more profitable, are certainly less safe. But some difficulty has arisen in regard to this in some of the Australian Colonies, and I should be very glad to see that removed. I hope that a proposal which I have to make to you will entirely remove any further difficulty, and it is that the British Board of Trade

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