-2-
Extract from the South China Morning Post of 24th. February, 1930
47
With an excess of supply over demand the Silver Market has trend- ed steadily downward throughout the year owing principally to a falling off in Indian demand, Continental sales of silver, presumably released when French Indo-China decided upon the transfer of their currency to a gold basis, an operation which they have now virtually accomplished, and, finally, a continuance of sales by the Indian Government.
As regards this last it is reasonable to suppose that in future, with the Refinery now working in Bombay, surplus coin in the Silver Currency Reserve will generally be refined and sold locally as opportunity offers, thus narrowing the outlet for the world's production. The increase in the Reserve is a weight on the silver market and with conditions as they are in China one looks in vain for any probable source of a
consumptive demand
of sufficient strength and endurance to effect an appreciable recovery in prices. As I have said, our local requirements in Hongkong are bound to prove limited.
Silver Prices.
Trade in China.
the
ministration in the fact that Government have transferred to Mr. Maze's hands the control of important establishments in
over the
Taking the staple imports, foreign Native Customs cotton manufactures have had to com- several provinces.
Railway communications, to which pete with a substantial increase of
The I shall again refer later, have shown output from the local mills. raising of the Japanese boycott also some slight improvement brought a flood of Japanese cotton conditions of the previous year, but goods on to the market, making com- military interference has prevented or petition extremely difficult for British crippled traffic on nearly all main manufacturers. The trade in lines. The construction of 600 miles woollens was dull in spite of lower-of railway track in Manchuria during ed prices. The engineering business the last three years is a fact worthy showed welcome signs of recovery of notice. from a long period of stagnation, Coastal shipping has had a difficult thanks largely to the quickening of year and again met with tragic ex- industrial developments on the perience
at the hands of pirates. Yangtze and to greater activity in Foreign navigation on the Yangtze the sphere of public works.
passed an uneventful year, the effect There was an increased importation of reduced volume of trade being of railway material, including engines partly offset by Government commen- and rolling-stock, a considerable de- deering of native vessels for military mand for aircraft for both military transport. and commercial use and a good market In India the past year cannot be for motor vehicles corresponding to ranked as a very prosperous period, the rapid extension of motor roads in the trade of the country having shown most provinces of China. British pro- a decided tendency to sag. The jute ducts, I may add, were fairly well re- and gunny markets, two of the most presented in the supply of industrial important, have suffered from lower inachinery, only moderately so in re- prices than had been seen for several gard to railway requirements and
years. The tea industry also saw a very slightly in the case of the motor steady drop in values due to increased trade.
crops and the existence of unusually large stocks in the United Kingdom. The last monsoon was a fair one and should improve the position in regard to foodstuffs. Native manufactures have been favoured by better relations between employers and labour.
Customs Returns.
The extreme quotations of the year for the price of silver were as 'follows,-highest: 26.7/16d., lowest: 21.5/16d., per standard ounce, which
The Customs returns for the year constituted a low record for the show a gross revenue of Taels 152 metal; (since then there has been a millions against 82 millions in 1928. further decline). The quotations iReckoned in silver this represents for Shanghai exchange were, an increase of 85%; reckoned in gold highest: 2/7.1/14d., lowest: 2/1d., per,68%; in this connexion I tael for telegraphic transfers to add that, under the new tariff, London.
half.
may
shewed a
Japan's Improvement. Japan's trade for 1929 the proportion of Customs revenue re- marked improvement over the low thequired for the foreign loans and in- level of 1928. Exports shewed a
demnities at current rates of ex-
large increase and the adverse trade change is considerably less than one-balance for the year, standing at Yen 67.1/2 millions, is the lowest for ten new Government which years. The took office about the middle of the year set itself strenuously to appreciate the value of the Yen in preparation for with the help of credits opened restoring the currency to a gold basis.
By a curious coincidence Shanghai exchange touched the top on the first and and bottom limits last days of the year respectively.
The mine production of silver for 1929 is computed at 275 millions of standard ounces which, added to 60 millions from outside sources, gives a total of 335 millions-an increase of 12 millions over the previous year. 'China's estimated consumption was 143 millions and India's 70 millions, corresponding respectively to 141 and 110 millions in 1928. China thus again achieved a record.
The trading conditions of last year in India and the Far East have, as I have already mentioned, been none too favourable. In the first place China failed to realize the promise of the previous year and relapsed into civil warfare; famine and brigandage played their familiar roles and a fur ther misfortune was added in the fall of the silver currency. This ac- cumulation of evils effectively destroy- ed any chances of trade expansion and I think we may reckon it fortunate that there has not been a more ap- preciable decline.
The raising of the tariff in February had little apparent effect on the volume of import trade which was well maintained during the first few months of the year. As the year pro- gressed, however, the various hin- drances to commerce became in- creasingly felt. Wars and disorders in the provinces together with the drop in exchange checked the demand for imports, while exports fell away under the burden of military taxation and difficulties of transport. In the
autumn came the disturbance of the foreign markets resulting from the crash on the New York Stock Ex- change, and the end of the year found business in China at an unusually low ebb with little prospect of an early
turn of the tide.
The Customs have not made avail- able the comparative
figures with former years which are necessary to furnish an index of the increase or
decrease of trade, but one may infer by calculation a falling off though not of serious extent from the pre- bring out the increasing prepon- vious year's volume. The figures derance of Shanghai's trade in re- lation to that of the rest of China, they also indicate a redressing of the balance between the northern and the southern ports, the south having re- covered much of the ground lost through the Communist troubles, while the figures for the north show distinct decline.
This is especially the case in regard to Tientsin which found itself starved of cargo from up-country owing to the political unrest and also suffered for the first half year from the un- navigable state of the river which connects it with the sea. churian figures reflect the disastrous The Man- effect of the Sino-Russian dispute and the interruption of the Chinese Eastern Railway which, besides in- creasing freight rates, upset the economic machinery of the country and severely checked all commercial development.
Shipping Difficulties.
abroad-to which this Bank contribut- ed as a member of a London banking syndicate this was accomplished on January 11th last when the embargo on the export of gold was removed. The rise in the exchange value of the Yen had the immediate result of de- pressing home prices and restricting commerce and industry.
These sacrifices, consequent on the delicate operation of restoring credit by artificial measures are, of course, inevitable, and though every effort will no doubt be made to minimize the effect, we must look forward to some continuance of the dullness in trade.
From a fairly promising start trade conditions in the Straits Settlements and Malaya deteriorated through the year and finished at a regrettably low level. A notable increase in the outstripped by the increase in produc- world's consumption of rubber was
tion and export, and prices receded in the latter half of the year to abnor- mally low figures. The tin industry presented similar features The im- port trade shewed a corresponding de-
part of the year. cline and was very dull in the second
let me add a word of recognition of While on the subject of the Customs, the very successful manner in which the service,
An Overcast Outlook. guidance, has emerged from the very Islands suffered from the effects of under Mr. Maze's Although trade in the Philippine
just over a year ago. difficult crisis with which it was faced world over-production of sugar
In spite of wars well as of the devastating typhoons revenues have been regularly remitted. tions are by no means unsatisfactory. and civil commotion the treaty-port of the previous year, general condi- tained prestige of the foreign ad-place both by private enterprise and· We have evidence, too, of the main- Considerable development is taking
as
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