quired to be signed by the British consular agents, and so forth. The Committee further recommended that the customs tariff of the Union of South Africa be amended so as to provide for: i. Preferential trading relations between all parts of the British Empire. ii. Reciprocal agreements with foreign countries, excepting the present enemy countries, against whose produce and manufactures a prohibitive tariff should be enforced... yet the other countries were in no way to be placed on an equality with the British Empire. (1). This enthusiasm started by and during the War does not seem to have subsided after the War. The present Government in South Africa cannot afford to be unsympathetic to appeals for protection, when that is necessary, and the Hon. F. S. Malan, the Minister for Industries, is reported to have stated "that an Advisory Committee had been instructed to draft a tariff of customs duties which would enable South African industries to keep their heads above water, and prevent the country from becoming a dumping-ground for other countries. To a certain extent the question of revenue would be borne in mind, as hitherto, in framing the tariff, but the maintenance of South African industries would be very largely kept in view." (2). To a certain extent the policy has always been in South Africa to make the tariff serve the dual purpose of a. Providing revenue, and, b. Providing protection to her young industries as far as possible. The policy has never been a definitely protective one, but the tariff has been going up gradually ever since 1855, until we now find many of South Africa's industries are protected by a duty of 25 per cent. ad valorem under the general tariff and 22 per cent. under the preferential tariff. Moreover, every high revenue tariff tends to become protective in its incidence- unless the dutied articles cannot under any circumstances be produced in the country employing a high revenue tariff. The following industries have grown up in the country under a high revenue tariff rather than under high protective tariff enacted definitely for the sake of protection: the manufacture of calcium chloride; calcium carbide; iron-smelt 1. Johannesbuhg Commercial Year Book for 1916, pp. 88-89. 2. See Board of Trade Journal, February, 6, 1919. ing; toy-making; sauces and other condiments; glass-bottle manufacture; shoe and floor polishes; sulphate of ammonium (the supply of this article from Europe was cut off during the War), (1); detinning of scrap tin; asbestos; tin-smelting; meat canning; lead shot; and pellets; prints and distempers from local materials; chicory production and preparation; glue and size; raw wax from bye-products of the sugar-cane; cement production; carborundum; stearine; lead-corroding for white and red lead; biscuit-making; printing; sugarrefining; soap; candles; explosive manufactures; matches; pottery; brewing; cigarette and cigar manufacture; woolwashing, (2), (many of these were originated during 1917); further might be enumerated the jam industry; boot and shoemaking; harness making; brickworks; the cart and waggon building industry; tailoring, and so forth. The following industries were established during 1919: (3) agricultural machinery; aluminium works; argol; asbestos cement; bone-char; briquettes or patent fuel; corn flour; concrete pipes; troughs; tanks; crystallized fruits; cream of tartar; dubbin; gluten; condensed milk; mathematical instruments; motor bodies and motor side cars; rubber manufactures; tartaric acid, and so on. Some of the above-mentioned industries received encouragement, for example, the soap, candle, jam, sugar and several other industries; but the protective duties have never been violently so. An energetic attempt was, however, made to start the diamond-dressing industry in South Africa, and since 1917 an export duty of 5 per cent. was levied on undressed stones without any important effect on the diamond-dressing industry, which had been carried on for some years in Pretoria and Johannesburg. In 1919 the duty was raised to 10 per cent. and a law passed which had as its purpose to enable local dressers to obtain the necessary stones from the producers of rough diamonds for their industry. This step was taken because local dressers had had difficulty in obtaining the raw material. (4). Prior to the War there was an export 1. Board of Trade Journal, September 19, 1918, p. 360. 3. Ibid. for September 23, 1920. 4. O. Y. B., Dutch Edition, No. 3, p. 624. An export tax on diamonds is highly commendable for the following reasons: (a) It is an article of luxury; (b) South Africa, producing 95 per cent. of the world's diamonds, has practically a monopoly of the industry. The tax will to a great extent be borne by the foreigner.. duty on Angora goats, likewise, for the purpose of encouraging the production of mohair in South Africa. There was also an export tax of 100 pounds sterling on ostriches and of 5 pounds sterling on ostrich eggs. The purpose of this was, of course, to enable the ostrich farmers to maintain a monopoly of supplying other countries with ostrich feathers. South Africa has always adopted a very careful attitude with regards to protection; the question of a protective policy has never yet been seriously discussed in Parliament. So far the country has been satisfied to believe that it was destined to be an agricultural and mining community. As early as 1853 Gamble had advocated in the Canadian Legislature in connection with Canadian Manufactures, that Canada should come first and then Great Britain. And Gamble's policy was adopted in Canada in spite of protests from "home." Whether South Africa will follow the footsteps of the sister Dominion at a very respectful distance remains to be seen. (1). The late War has shown that South Africa has sometimes to rely on herself. She was virtually forced into industry. Mr. H. K. Vere Hodge says in the review of the trade of the Union for 1918: "Many new industries have come into being and many new productions would probably never have seen the light of day under old conditions." Moreover, South Africa is in a much more favourable situation than was Canada at the start to ease the transition from extractive to manufacturing industry, because of the existence of the preferential tariff. Moreover, the English Government has much more liberal views now as to the development of manufacturing industries in the Dominions than in those days when Canada started on an industrial career. However, the very existence of the preferential tariff means that the duties will have to be high indeed if they are to give the South African manufacturer a chance against his British cousin. South Africa's industrial progress has been immense during the last thirty years. The number of factories has increased since 1890 from 550 in that year to 1,500 in 1910. In 1920 there were about 6,000. (2). Approximately 50,000 white 1. Porritt: Sixty Years of Protection in Canada, p. 212. 2. The statistical unit has of course changed somewhat, but the fact remains that the increase has been immense. For 1917 the value of factory production in the Union was over 40 millions sterling. In 1891 it was a little over 5 millions, in 1904 it was over 19 millions, while in 1911 it was a little over 17 million pounds sterling. These are the only data which have previously been collected in respect of the manufacturing industries of the Union. The hands were employed in these in the latter year and about 84,000 semi-skilled and unskilled coloured and native labourers. They produce annually manufactured goods to the value of over 60,000,000 pounds sterling. The factories consumed raw materials to the value of 34,,000,000 pounds sterling, of which over 50 per cent. are of South African origin. (1). The cautious policy as regards protection has been successful as far as it went. We shall later discover that South Africa can go a good deal further along this line and still be successful in keeping her industries going and encouraging others on which there is no reason why she should not be able to spend her energies and work under conditions of a comparative advantage. But how about South Africa's preferential policy which she adopted in 1903 after applying her customs duties indiscriminately to all nations alike for half a century, and which she adopted in order to keep the British industries going? Is that equally commendable as a healthy protective policy to South Africa's infant industries, does that fit in with such a policy, and does that work for the best interests of South Africa? It will be well to look into this matter before the general industrial situation in South Africa comes up for discussion. After 1910, then, the industrial situation in South Africa remained fairly stagnant until there were exercised on the industrial development of the country the fundamental effects of the Great War. It acted: (i) As a very high protection to South African industries; (ii) As an incentive to the people to produce those manufactures which were indispensable to them as a civilized community and which they could not get from abroad on account of the war. In 1915 the duties were raised, and the year before an untimely "dumping" duty and a provision against bounty-fed articles were introduced into the South African tariff. In October, 1916, the Union Government appointed an Industries Advisory Board, and at the recommendation of the latter body there was created, early in 1917, a Scientific and Technical Committee. "The Committee and the Advisory Board, working in close co-operation with the Industries Department, investigated and reported to the Government on questions affectbasis of the returns in each of the censuses of 1904 and 1911 was different. Much was included that was eliminated in the inquiry of 1915 1916, the industrial census of 1917. 1. For a resumé of South Africa's industrial progress see Board of Trade Journal for September 2, 1920, p. 273. See also the different industrial censuses and an article by the author in "Industrial South Africa" for June, 1923. ing the economic, scientific and technical aspects of the utilization of raw materials available in South Africa, and collected data and information in regard to the recources of the Union, which as yet are largely undeveloped." (1). In October, 1918, the Industries Advisory Board and the Scientific and Technical Committee were amalgamated under the title of the Advisory Board of Industry and Science. (2). A Customs Tariff Board has also been established in 1921 in order to coordinate the Departments dealing with the question of the tariff, and because such a body was necessary so as to give more close and continuous study to the tariff than could be done by the Advisory Board of Industry and Science. (3). In order to spread useful industrial information the Industries Department in 1917 started the publication of a very excellent journal called the Journal of Industries. We have now briefly sketched the industrial advance of South Africa during the late European War, and the various factors which influenced the industrial growth. The enthusiasm for industrial development in South Africa was, likewise, possibly influenced by factors like the Dominions Royal Commission (1914), the Paris Economic Conference (1916), and the Final Report of the Committee on [British] Commercial and Industrial Policy after the War (1918). The outstanding feature of the Paris Economic Conference was discrimination by the Allies against the Central Powers during, and for some time after the War. It was, perhaps, a measure to scare the Germans, more than anything else. The Paris Economic Conference, moreover, provided, that "whatever may be the methods adopted, the object aimed at by the Allies is to increase production within their territories as a whole to a sufficient extent to enable them to maintain and develop their economic position and independence in relation to enemy countries... The Representatives of the Allied Governments undertake to recommend to their respective Governments to take without delay all the measures, whether temporary or permanent, requisite for giving full and complete effect to this policy forthwith, and to communicate to each other the decisions arrived at to attain that object." How far this policy affected industrial development in South Africa it is impossible to say. There are no indications to show that the influence was powerful. The British Commission on Industrial and Commercial Policy after the War, urged, inter alia, the safe 3. Board of Trade Journal, June 23, 1921, p. 705. |