seriously. Sixty-six per cent. of the number of wage-earners, who at the beginning of the previous year remained at their work had since been discharged, it was reported. "The abovementioned cheap imported goods actually undersold the candles manufactured by the leading British makers by a large margin, in spite of the preferential duties accorded British manufactures, so much so, that importers of candles made in the United Kingdom lost heavily on their stocks in hand and under contract. The effect of the dumping on colonial factories, which had already suffered severely by the Customs Convention (of 1903), was "deplorable," and was clearly illustrated by the discharge of a number of wage-earners from permanent employment in that industry, which was then nearly "extinct." (1).

At a conference of representatives of the various Chambers of Commerce of the Orange River Colony, the following resolutions were adopted:

i. "That the conference is of opinion that protection is required to foster the South African manufacturing and farming industries, which should be done by customs duties only, and that the preferential railway rates levied as a means of additional protection should be discontinued."

ii. They resolved that there should be more protection than was afforded by the then existing tariff, and that they were for preferential trade with Great Britain and the colonies only after a sufficient degree of protection had been secured. In case of reciprocity they asked for 12 instead of 10 per cent. ad valorem (2) — British goods to pay 10 per cent. ad valorem.

The position, then, in South Africa, prior to the Customs Convention, was more or less as follows: The Transvaal was coming to the Customs Convention with the interests of the mining industry to safeguard: there was to be cheap food, and so on. As regards the rest of the community, there was a strong desire for the protection of local industries against the neighbouring colonies as well as against the outside world. Cape Colony and Natal were for moderate protection for selected industries and protection for agriculture. Rhodesia wanted cheap food and no protection, as there were hardly any industries to protect. (3).

The Convention met at Pietermaritzburg and lasted for three weeks. There was the greatest secrecy maintained as to

1. "South Africa," February 10, 1906, p. 421.
2. "South Africa," February 17, 1906, p. 491.
3. Ibid. for February 24, 1906, p. 574.

its proceedings. The tariff of 1903 was considerably modified. The principle of preferential treatment of goods from the United Kingdom was confirmed and extended considerably, in spite of the fact that the mother country had hitherto failed to respond. Preference was extended to many articles charged with a rated duty. (1). Many duties were raised especially for the sake of rebate on British goods. Note the following:

The tariff was renewed on a strongly protective basis. For revenue purposes many duties were raised which were protective at the same time. A high revenue tariff naturally tends to become protective in its incidence. There is no way out of it. Moreover, it has always been South Africa's policy to frame her tariff so as to produce revenue, and protect the nation's industries at the same time. (2). The duty on cigarettes was increased. Boots and shoes came under a duty of 15 per cent. ad valorem. Aerated waters, fruit syrups, biscuits and cakes, blankets, bricks, harness and saddlery, all paid 25 per cent. ad valorem, and in spite of the 3 p. cent. preference on these articles — which meant so much less protection to the local manufacturers - the duty was high enough to provide ample protection for these industries. Manufactured articles which were used for manufacturing purposes in South Africa, paid 3 per cent. ad valorem, and this whole duty was granted as a rebate to countries which might enjoy preference. This favoured Great Britain and Canada as against their competitors. The general ad valorem duty was raised from 10 to 15 per cent. on which a preferential rebate of 3 per cent. was granted. The "Rhodes Clause" was further maintained by which duties upon British goods imported into Rhodesia could not exceed 121 per cent. Free trade in South African produce that is between the parties of the Union was established, except

1. For everything in connection with the Customs Union of 1906, see Cd. 2977: British Parliamentary Papers for 1906, Volume 15. 2. Cf. Fremantle: The New Nation, p. 167.

as regards spirits, wines, beer and blasting compounds, which were subjected to special regulations. (1).

Any member of the Union was free to suspend at will the whole or part of the duty on meat and animals for slaughter. Southern Rhodesia, besides retaining the right of enforcing the "Rhodes Clause," also retained the right to modify the tariff within her territories in many other particulars. By Article 18 any colony or territory belonging to the Union had the right, under suitable regulations, to rebate the whole or part of the duty on methylated spirits or alcohol imported solely for manufacturing purposes, or for fuel within its borders, and on soap and other substances imported for and exclusively used in connection with the wool-washing industry.

Sugar continued to be protected, while in the case of sugar upon which bounties were granted in the country of origin, an additional duty, equal to the amount of such bounty was to be levied. As stated above, the duty on confectionery was raised, while manufacturers' requisites like glucose, moulding starch, gelatine, and unsweetened dessicated cocoa-nut in bulk, were allowed importation at the low duty of 3 per cent. ad valorem. The same applied to crucibles, cupels, cupelling furnaces, graphite, ingot mould, retorts and furnaces for roasting minerals; hops, hubs, rims spokes, felloes, shafts, tent-bows or poles cut or fashioned but not finished, and many other articles. Water-boring and pumping apparatus and pumpsnot including beer pumps - were allowed importation under the 3 per cent. ad valorem duty likewise. Many articles used in connection with colonial industries were allowed duty-free importation. Note the following: Bags-not paper-for flour, grain, manure and local manufactures, produce, sugar, wool, coal and mineral, and bagging and sacking in piece; coir, candle wick, wax-paraffin and stearine grease; cotton, flax, fibre, hemp, jute: raw, waste or unmanufactured, for the candle industry. The candle industry was further protected

1. By Article 16 of the Convention, any colony and territory belonging to the Union might at any time levy a customs duty on ale, beer and blasting compounds, the manufacture of any other such colony or territory, but the duty should not exceed any duty of excise which might be levied by the importing colony or territory on similar articles produced within its own borders, provided that such articles, from whatsoever part of the Union they might be imported, should be liable to customs duties. On spirits, the manufacture of wine within the Union, a duty of excise of 9s. per imperial proof gallon was to be levied and a customs duty equal to this charged by the importing territory of such spirits manufactured of the vine.

by the general ad valorem duty of 15 per cent. instead of 10 per cent. ad valorem under the tariff of 1903; nitrates, except ammonium nitrate, for manufacturing purposes, for example, the manufacture of blasting compounds for the mining industry, were allowed duty-free importation.

Under the 1903 tariff articles falling under the free list and those charged with a duty of 23 per cent. ad valorem, numbered 96; in the tariff of 1906, the ad valorem duty was increased to 3 per cent., and the number of articles falling under this duty and of those admitted duty-free was 117.

It was also provided by Article 22 that the Transvaal could import free of duty all goods and articles excepting spirits the growth, produce or manufacture of the Portuguese Province of Mozambique, or of British Central Africa, provided that those products and manufactures were the products of the soil of the countries in question.

After the new Convention had been drawn up it had then to be carried through by the different legislatures, "and each of these public bodies was told that it might discuss the details, but that it could not be allowed to alter one of them. The Convention was cut and dried, and they must each and all take or leave it as a whole.' (1).

The tariff met with considerable opposition in the Cape Parliament. In the House of Assembly Mr. Sauer moved to add to the motion approving the tariff, that there should be an abolition of all preferences or discriminating duties. In favour of his amendment there were 38 votes, nearly all Dutch; against it there were 49 votes, nearly all English; while in the Legislative Council, to the motion approving this new tariff, the following was added on the motion of Mr. Graaff: "Though it regrets the inclusion in the said Convention of the principle of preferential duties.” This was carried by 14 ayes to 11 noes. Even in the Transvaal, which had only a Legislative Council in 1906, there was opposition to the Convention tariff, as it was passed there by 12 to 8 votes. (2). At a meeting of the Johannesburg Chamber of Commerce, on July 3, 1906, a resolution was passed expressing regret at the fact that the colonial Legislature had ratified the Customs Convention, as it added to the burden of taxation, especially on the wage-earning classes, and had the effect of benefiting the coast colonies in augmenting their revenue and protecting their industries, whilst no benefit would result to the Transvaal com1. Egerton: Federations and Unions in the British Empire, p. 149. Commerce and the Empire, p. 149.

2. See Senator Pulsford:

munity or its industries. (1). However, the Transvaal had agreed at the Convention, that if the tariff proved burdensome to the consumer of the up-country, it would substantially reduce its railway rates. (2). It is thus plain that the dissatisfaction was as strong as ever in South Africa over this preferential scheme. It also seems plain that the bill could not have passed the Cape Legislature at least, but it was Mr. Wiener's position over again. If preferences were abolished, it would have meant disloyalty and ingratitude.

This discontent was growing in South Africa in spite of the fact that the people believed in South Africa, that a breakup of the Customs Union would retard the general political union in South Africa. It was merely some sort of temporary agreement which was patched up at Pietermaritzburg. The coastal colonies received satisfaction under the high tariff, but this was against the interests of the Transvaal with its large mining population. The farmers of the Transvaal, it was stated on the other hand, disliked the idea of free trade with the Cape Colony. The Convention was very unpopular. All this dissatisfaction led to the statesmanlike despatch of Lord Selborne, which here follows (3):

Johannesburg, January 7, 1907. "If the possibility of railway rates being made a weapon of international strife is a danger, what would be the danger of a customs war between the British South African colonies? Imagine each of them with a separate tariff, framed expressly with the object of fostering the trade of one colony to the detriment of the trade of its neighbour! Imagine each colony ringed round with a barrier of internal customs houses! The result would be the destruction of commercial stability, the stagnation of industrial enterprise, the creation of a permanent depression. The sun of progress would go back 10 degrees on the dial of South Africa... Can they [the Colonies] stand still on the compromise embodied in the present customs convention? That Convention does not represent a South African customs policy it is a compromise between five colonial customs policies, almost universally disliked, tolerated only because men shrink aghast from the consequences of a disruption of the Convention. The only path of safety is a forward path to a South African tariff, based on the deliberate policy of the

1. Report of the Johannesburg Chamber of Commerce for the Year ending February 28, 1907, pp. 9-10.

2. "South Africa," March 31, 1906, p. 597.

3. Cana: South Africa from the Great Trek to the Union, p. 313.