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South Africa's Experiences of Trade Controls.

We have had plenty of experience of these attempts to put matters right by subsidies and restrictions and control and licences and things of that sort, and I am perfectly certain that no solution of our difficulties is to be found along those lines. In South Africa we had quite a recent experience in regard to the control of imports of boots and shoes. It was a most highly unsatisfactory proceeding from beginning to end, but I am glad to say we have given it up now and meet our difficilties there by the imposition of a tariff.

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Protection by Tariffs the only Real Solution.

I am inclined to think that there really is no alternative to protection by tariffs, if we except these arrangements being made amongst ourselves now by way of helping on trade. But Mr. Bruce seems to think that if these proposals were turned down—and I think it was inevitable that they should be turned down there may be some other way of doing it. What other way of doing it is there? The tariff idea I understand, but the other thing I confess I do not understand. However, I entirely agree with the findings of that Committee, and, as I say, I do not see how they could have come to any other conclusion.

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The South African Position: No interference with British Fiscal

Autonomy. Now, Mr. Chairman, I just want to say with regard to Preference generally, that my attitude on behalf of South Africa remains what it was at first. We welcome what you propose to do in respect of the matters you have mentioned. As to going any further, the principle of reciprocity, as I told you, was advocated in South Africa many years ago, and is perfectly sound in itself. But while we welcome what you propose to do, we do stand upon this basis, that we claim the right in our Dominion to settle our own fiscal policy, and therefore we do not claim any right, whether by actual motion or even by "methods of education, to interfere with the right of the British people here to settle their own fiscal policy for themselves. That is our position in broad outline.

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Appreciation of Great Britain's further Preference Proposals.

Now, as to the details of your statement to-day, Mr. Chairman, I am very glad to hear your proposals with regard to fresh apples. That, I think, will be of material assistance to South Africa, where both in the Transvaal, and in certain parts of the Cape Province, there is a great deal of apple-growing going on, and which can undoubtedly be extended considerably. This proposed preference of yours will mean about 28. 6d. preference on a bushel, I think, and it should go a long way to assist the South African producer to pay his freight and enable him to compete in respect of this article in your markets. That is quite a good thing from our point of view. I welcome also the proposal with regard to fruit juices and honey. The honey may be a comparatively small

matter now, but is capable of being expanded. With regard to wine, I shall have something to say about that to-morrow.

Now, I just want to mention one further point. Mr. Bruce expresses appreciation of the proposals you make of your volition. I am afraid, Mr. Chairman, that that attributes to us in the Dominions a shy modesty and backwardness that we are not exactly entitled to--I am afraid not even Australia and New Zealand. In view of the speeches we have heard to-day we cannot make that claim. As a matter of fact we have brought representations to the notice of your Government in various matters, and what I want to say is once more to express our appreciation of the fair and liberal way in which you have met the representations that have been made.

Appeal for Preference on Canned Cray Fish.

There is one point of detail, and that is canned salmon. I have nothing to say against that. On the contrary, I welcome it, but may I point out to you that, whereas in South Africa we do not can salmon, we do carry on a very large and increasing business in the canning of cray fish. I think, last year, if I am not mistaken, we exported about a quarter of a million pounds' worth of this commodity. It used to be more appreciated in France than here, but now the market is shifting and there is a good deal of it coming here. If excellent salmon from Canada and elsewhere are entitled to have this preference, it seems only fair that preserved cray fish from South Africa should be included in the same category.

Principles on which proposed Preferences based.
The Chairman : Let me take that point up with you now.

I have gone into that. The tests we were inclined to lay down for ourselves in considering any of these propositions were : (1) Is there a reasonable chance of the Dominions being able to provide a large volume of trade? (2) Is it a trade which they have not already exclusively enjoyed? Because, obviously, if there is no risk of competition a duty would merely put up the price. Conversely, if they are doing the whole trade at present, and there are not competitors, we should only put up the price by putting on a duty.

Question of Preference on Cray Fish will be considered.

Cray fish I certainly will consider. They come under “Other sorts of fish, including shellfish,' as we describe them. There you do about 33,000 cwts., while the foreign countries do about 41,000. You have not put the case forward. I rather anticipated you would.

Mr. Burton : Yes, I am doing it now.
The Chairman: I will take it now.

Mr. Burton : As long as you see that it seems a fair thing, and as you say that cray fish shall come in too, I think that is all I have to say for the present. [10995]

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Mr. Riordan: The position we are in is rather a happy one; wa have no grievance to ventilate in regard to this matter. I think I am right in saying that already inter-trade between Ireland and Great Britain is greater than that between Great Britain and any other Dominion; this, of course, is due to our proximity. There seems every prospect that trade between the two countries will increase as time goes on.

The items upon which you propose recommending further preference are in most cases items which do not interest us. The question of raw apples opens up the possibility of an extension of that trade. Honey is another item which may interest us to a certain extent, but not the others you have mentioned, with the possible exception of wine—I do not know whether or not you propose referring to the “wine" of my country to-morrow. At any rate, I shall wait until then for your disclosures on this point.

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Question of Frozen Salmon and Canned Lobster.

Sir Patrick McGrath : I have merely to add a word of thanks on behalf of Newfoundland for the inclusion in the list of articles under preference of canned salmon, which is about the only product we export, of those so listed, that is affected. I would suggest though, that consideration might be given to the item of frozen salmonfresh salmon and salmon in the chilled state-of which we export

Canada, I think, also exports some, and there is competition from Norway and Sweden. I had intended raising the question of canned lobsters, suggested by Mr. Burton, because there was a competing industry from the State of Maine in the United States as against canned lobsters from Canada and Newfoundland. But if the figures show there are no competing exports to the United Kingdom now, it is not necessary to press that point.

The Chairman: I think there really is not, because, if I take 1922, the total imports from all foreign sources were 1,560 cwts., while the Empire importations were 35,577 cwts.

Sir Patrick McGrath : Largely from Canada, Newfoundland and South Africa?

The Chairman : From Canada and Newfoundland, yes.

Sir Patrick McGrath : May I make one suggestion, that in the phrasing of the provision with regard to shellfish it might be so worded that the question will not arise which those familiar with international problems of fifteen or twenty years ago will recall, when Newfoundland had a very important dispute with France, running for nearly two centuries, an aspect of which was whether the lobster was a fish or not. It was ultimately settled by an exchange of territory in West Africa and by buying out the French fishermen on the coast of Newfoundland by a payment of £250,000 from the British Treasury.

Newfoundland's Experiments in Trade Control.

With regard to the larger question, I wish to express my sympathy with the view and the argument put forward by Mr. Bruce on behalf of Australia, but I do not think the remedies lie along the line he suggests. Like Australia, we produce a perishable foodstuff in the form of dried cod fish, and at times we have a situation such as confronts Australia at the present time with regard to her beef.

We, too, have tried some of the experiments suggested in his speech at the opening of the Conference. We have tried the question of stabilisation, and we have tried to regulate the market, not by import but by export licences. We tackled both of those problems during the past couple of years with disastrous results, both to the state and to the business people concerned.

In an endeavour to stabilise the price of cod fish, the Government set aside half a million dollars for the purchase of cod fish on Government account and put the business in the hands of three or four firms of good standing. But despite that, the result was very disastrous. The return to the Colony did not exceed 20 cents in the dollar.

We also tried a scheme of export licence, and attempted to control the export of the product from our own country by stipulating that nobody should be allowed to export cod fish unless he undertook to sell the cargo of fish in foreign markets at a price not less than that fixed by the Government through a Board of Control. The result of a year's experimentation along these lines was that several of the people concerned in the export of cod fish went bankrupt. I know traders who, in the fall of 1919, could write a cheque for hundreds of thousands of dollars, but who two years later had failed and could not pay 10 cents in the dollar.

I do not mean to argue that that entire result came from this scheme of Government control, because we were due for a setback like the rest of the world, but many think it contributed very largely to it. Not alone did we lose the sale at a profit of much of the current season's catch of cod fish, but we ran the risk of losing some of our markets altogether, because our competitors invaded then., undersold us, and strengthened their own position while ours was weakened.

I might simply add that, like Mr. Innes in India, I was Food Controller in Newfoundland during the war, and the result of my experience and observation was to convince me that the less any Government has to do with the marketing of food products, or interference in general industry, the better for the country concerned.

The discussion was resumed at the Twenty-first Meeting, held on the afternoon of the same day (the 7th November, 1923), follows:

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Attitude of India towards Preference Negotiations.

Mr. Innes: I have very little to say, Sir, upon the proposale for increasing and extending the existing preference. I should just [10995]

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like to explain that we made no representations to His Majesty's Government in regard to these proposals and that we have taken no part in the negotiations which have been going on with His Majesty's Government since these proposals were last discussed in the open Conference. That was not due to any modesty on our part; it was merely our own self-respect. India, as I have already explained, under her existing system of revenue duties, grants no favours to anyone, and in consequence we are not in a position to ask for any favours. But since there are crumbs falling from the rich man's table I am glad some have fallen our way. India grateful for increased Preference on Tobacco.

I was particularly interested in the announcement made that the preference on tobacco was to be increased to one-fourth. Since the war we have built up quite a large trade with the United Kingdom in unmanufactured tobacco and I hope that that trade will be further stimulated and increased by this increased preference. I should like to repeat what I said before, namely, that we are grateful to His Majesty's Government for these concessions which they have shown to India without asking for any return on India's part and I do hope that when the time comes for India to consider the question of preference, India will not be unmindful of the benefits she has received not only from His Majesty's Government, but also from New Zealand and Canada. India endorses Report of Food and Materials Committee.

I now turn to the Report of the Committee on Food and Materials. I was a member of that Committee and, naturally, I subscribe to every word of the Report. I heard the Prime Minister of Australia suggest that, in the time allotted to it, it was not possible for the Committee to give that exhaustive consideration to those proposals which they required. It is quite true that we were not able to devote very many days to the consideration of the proposals. At the same time some of the members of the Committee were men who had had actual experience of the working of schemes similar to those suggested by the Prime Minister of Australia, and, speaking for myself, as one of those who has had this actual experience, I may say that I do not think it would have made any difference if we had sat for a month on these proposals instead of for three days. It is perfectly true that my experience, and the experience of Sir Patrick McGrath, was experience gained in war conditions, but my experience gained during the war merely reinforced convictions which I have always held. Statesmen may be very wise. They are nearly always assisted by the best brains they can get in the country in the shape of their permanent Civil Service. At the same time international trade is so vast and so complicated that my own conviction is that the less statesmen and Governments interfere, by way of prohibitions and restrictions, in international trade the better for everybody concerned. I am particularly glad that this Committee's Report endorses the resolutions already passed by the very important Genoa Conference, and I hope that this Conference will also endorse those conclusions.

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