CO129-440 - Others & Individuals - 1916 — Page 87

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which were the equivalent of as much as 1s. 3d. to From the British ls. 4d. per yard c.i.f. Shanghai. industrialist's point of view this is eminently satis- factory, as it is generally recognised 'that in the coarser grades of grey cloths we shall have to meet an ever-increasing competition from Japan and the textile factories in China itself, but in the higher grades, and in bleached and dyed goods, Lancashire is well able to hold her own, and to secure the greater portion of we keep the net increase in the trade if only

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courant with the ever-changing needs of the business, and improve our marketing organisation. It is true that direct distribution is not suited to very many articles of import owing either to their bulk, difficulty in handling or variety of qualities,

am colours, but I designs and

confident that more could be done in the way of direct distribution even of articles such as cotton piece goods. We see the great Japanese merchant houses distributing their grey sheetings, drills, nankeens, and red cambrics throughout Manchuria and North China. A wide distribution scheme for grey cotton cloths was actually working throughout the Northern Provinces a few years ago through the medium of an existing organisation, and was discontinued, not from the inherent defects of the The system, but owing to totally extraneous reasons. Russian merchants are selling high-grade cotton prints, the most complex and diversified of all piece goods, through their agencies in the towns of Manchuria and China proper, and are prepared not only to sell multiples of one case, but even single pieces and single yards. Three months' credit is allowed to guaranteed native merchants, and with regularly established agents this is usually extended to six, and in exceptional cases nine months. Although reverses were incurred at the Commencement due to extended credits, unsatisfactory guarantees, and defective control of stocks, with the perfection of the system, these losses have been turned into substantial profits, and the result is that 51 per cent. of the imports into China of chintzes and plain cotton prints are to-day of Russian origin, while 65 per cent, of the import of grey sheetings, 73 per cent. of grey

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preferably, by sending out engineers trained in their work, experts in their own lines, to assist the Eastern staff in the pioneering work, to travel, and give their expert knowledge in drawing up plans for schemes, making preliminary estimates, and advising the Chinese purchaser as to the best way out of his difficulties. British manufacturers in this way would have the benefit of dealing with financially sound, reputable firms in China, would be freed from the risk and worry of establishing their own system, and would receive all the benefits accruing from old-established Chinese connections. Individualism has been carried too far in the past, and the closer co-operation of our officials, manufacturers, merchants and financial interests will be necessary if we are to compete successfully with that close co-ordination of Government, financial, industrial and mercantile effort which has characterised the German engineering trade. It is extremely probable that German competition in China will be keener than ever after the War. Germany will have to devote greater attention to those neutral overseas markets, such as China and South America, where there is no sentiment against her, and we can only hope that she will be so crippled financially that her banks and finance houses will no longer be able to accord exceptional facilities to her merchants; and, on the other hand, we trust that our own banking and financia institutions may see their way so adopt a less rigid attitude with regard to the financing of deferred pay- ments on sound industrial contracts in China, and that the greater share of that British capital which formerly financed our competitors may in future be utilised for furthering the legitimate expansion of British industry and commerce.

By far the most striking and far-reaching develop- ment in the foreign trade of China during the past fifteen years has been the rapid increase in the number of firms who are distributing their goods direct to the Chinese consumer in all the large cities and towns of the interior through the medium of guaranteed Chinese agents working under the constant supervision of European travellers and inspectors. The pioneers in

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