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PUBLIC RECORD OFFICE

Reference :-

C.O. 885

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PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

12. Assuming that the preference aimed at by the Resolutions is given in the way most favourable to trade, namely, by the partial remission of existing duties in favour of British and Colonial goods, rather than by an increase of duties on foreign goods (coupled with the imposition of duties on goods of foreign origin now admitted free which compete with British and Colonial produce), it is obvious that, as the total trade of the Empire with foreign countries far exceeds the trade between the various members constituting the Empire, the volume of trade upon which taxation is to be placed exceeds the volume which would be partially relieved. The result would not only necessitate increased taxation but would involve a serious net loss of trade, the burden of which in both cases would fall with greatest severity on those parts of the Empire which have the largest proportion of foreign trade, and the loss to these parts would more than outweigh the gain to the other parts.

13. On closer examination it would appear that the material results of the proposal would be even more prejudicial than appears from the general state- ment of its more obvious results. In the case of

this country, the bulk of the imports from foreign countries, and almost the whole of our imports from

the Colonies, consists of food or raw materials for

manufacture.

raw

14. To impose a duty on food means at once a diminution of the real wages of the workman. If, in addition to this, a duty were imposed on materials, a further encroachment would have to be made on wages to enable the manufacturer to compete with his rivals in countries where there are no such duties.

15. The Honourable Mr. Foster, in his speech in- troducing the motion now under review, drew a vivid picture of the vigorous and unrelenting competition which the British manufacturer has to meet in the

markets of the world; and, if he somewhat over-

estirnated the results of that competition, there can

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be no question as to the fact that in many branches of trade in which Great Britain once held a distinct superiority other nations now compete on equal terms. In so far, then, as the British manufacturer failed to shift the burden of any duty on food and

raw materiale on to wages he would be at a disad- vantage in the open markets of the world, and the remission in the Colonies of part of the duty in his favour would scarcely place bin on level terms

with his foreign competitor even there.

16. It must not be forgotten, moreover, that at present about one-fourth of the export trade of this country consists of foreign and Colonial produce, and that the imposition of duties on foreign produce would involve an enormous immediate outlay for the exten- sion of bonding facilities, and the necessary charges for their use and maintenance. The result would

be to place such obstacles in the way of this trade that its transference elsewhere would speedily take place, goods which this country now receives for re-export being sent direct to their market, or through some other entrepôt where they would not

be subjected to such disabilities.

Thus the posi-

tion of this country as the great market of the world,

already threatened, would be destroyed.

17. These changes could not fail to seriously injure our important carrying trade and to react injuriously

on every industry in the United Kingdom.

18. On the other hand the gain to the Colonies, whatever it might be, would, even at first, be alto- gether incommensurate with the loss to the Mother Country. And it is improbable that there would be any permanent gain, for, apart from the general loss

of purchasing power, due to the fall in wages and profits, resulting from the imposition of duties, it is obvious that the reduction of our imports from foreign countries would be followed by a reduction in our exports to them, no inconsiderable part of which consists of Colonial produce imported in a crude state and more or less manufactured in this country, The demand, therefore, for Colonial produce, even with the preferential advantage proposed to be allowed

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