In 1911 the rebates were reckoned as follows:

On Australian goods in South Africa, 45,918 pounds sterling;

Difference-55,348 pounds sterling. (1).

99

South Africa has reason to grow restive under imperial preference. The South African and Canadian preferential rates were applicable to practically all the dutiable goods imported, whereas in New Zealand the preference accorded to the United Kingdom products was confined to certain classes of goods only. (2). But it is found after all that although the rate of preference allowed in Canada varied from 2 per cent. to 15 per cent. ad valorem, with an average of nearly 10 per cent. ad valorem in favour of British goods; in New Zealand from 10 to 20 per cent. ad valorem on the classes of goods to which preference was accorded, while in South Africa its equivalent was about 3 per cent. ad valorem, that the actual rates of duty leviable on the principal classes of British goods were, on the whole, higher in Canada than they were in New Zealand, and much higher than they were in South Africa. It is also found that, partly owing to the proximity of the United States to Canada the proportion of its imports from the United Kingdom was considerably less than it was in the case of the other colonies, and the actual value of these imports from the United Kingdom into either South Africa or Australia. The imports from the United Kingdom into Canada amounted to about 24 per cent. into South Africa and New Zealand 62 per cent. of the total value of imports into those colonies during the year 1905. Canada at that time accorded preference to 66 per cent. of all her imports from the United Kingdom. According to the Cape returns for 1905 as a fair sample of South African trade the Cape would have accorded

1. See Pulsford: Commerce and the Empire, p. 152; see also p. 151.

2. See R. Jebb: The Colonial Conference, p. 370.

preference to 84 per cent. of its imports from the United Kingdom if the Customs Union Convention of 1906 had been in force. It is found that the imports entitled to preferenceinto the Cape Colony - from the United Kingdom, New Zealand, Canada and Australia amounted to 61 per cent. of its total imports in 1905. Preferential treatment was granted on goods of the United Kingdom or to manufactures of the other reciprocating colonies to the value of 11 million pounds sterling in the case of Canada, 2 millions in New Zealand, and about 11 millions in Cape Colony in 1905. (1).

Thus South Africa, granting a preference in some instances of a fifth of the duty, on about 80 per cent. of all her imports of British goods, does not get a quid-pro-quo in return. She sacrifices much more in revenue than all the others combined do sacrifice by granting preference to South African goods. The following table will indicate what South Africa actually allowed in rebates for the six years from 1913 to 1918 (2):

Total value of merchandise, the produce of the United Kingdom, Australia, Canada, and New Zealand imported into the Union of South Africa and the amount of rebate granted: Value is given in pounds sterling:

imports 22,494,415 18,957,760 17,664,355 23,576,851 19,566,651 25.158,773 Rebate 628,935 524,275 475,761 643,486 525,073 698,231

In 1913, for example, the amount rebated to importing firms in the Union amounted to 11.32 per cent. of the gross duty, in 1914 to 11.38 per cent., and SO on. In 1915 there was a decline due to the fact

1. See R. Jebb: The Colonial Conference, p. 371.

2.

Half-Yearly Abstract of Union Statistics, June, 1919, p. 60. The rebates are not paid out to the importers, but are reduced from the full duties otherwise payable at the time of importation or clearance from bond.

that formerly in Class vi of the customs customs tariff the duty was 15 per cent, on foreign goods and 12 per cent. on British goods, while under the 1915 tariff alterations the respective duties were raised to 20 per cent. and 17 per cent. in this class. (1). The alterations raised the duty without making a proportionate increase in the preference. For the period 1910 to 1912 the amount of rebate granted compares fairly with the period 1913 to 1918, and stands as follows:

1910. 594,297.

1911. 601,126.

1912. 602,978. (2);

Pounds sterling: while for 1919 there was allowed in rebates the sum of 586,168 pounds sterling, and in 1920 no less than 1,314,356 pounds sterling. (3).

Statistics show that the United States is the chief competitor of the United Kingdom for the trade in South Africa, in spite of this rebate granted on British goods. Surely Milner and Chamberlain had in mind nothing less than a monopoly of the South African trade for the British manufacturers when they introduced their scheme into South Africa. Mercantilists think only in terms of exclusion, preference, monopoly and gold. There was to be no compromise. The market which was "won by the expenditure of so much blood and treasure” was not to be allowed to pass into the hands of the foreigners. It now seems that Milner and Chamberlain were too sanguine in their hopes as to the good results of the preferential tariff. (4). Instead of keeping the foreigners out of the market, instead of greatly increasing British trade, we find that the artificially-bolstered-up British trade has been remaining fairly constant so far as the value of the imports is concerned, and has been actually declining in relation to foreign trade and that of the United States of America in particular. The

1. Board of Trade Journal, June 3, 1915, pp. 671-672. 2. South African Statistical Year Book, 1914-1915, p. 208. 3. In the 1921 session of the South African Parliament Senator A. Wolmarans asked the Minister of Finance whether the Government did not share the opinion that the preferential tariff was an obstacle to the establishment of factories in the Union for the manufacture of similar articles as those on which preference was granted, and whether it would not be wise for that reason to abolish the preference. To this the Minister replied in the negative. It was to this question that the Minister gave the figures of the rebates for 1919 and 1920.

4. See Lemonnier: La Politique des Tarifs Preferentiels dans l'Empire Britannique, pp. 223-233.

trade of the United States with South Africa - that is, the United States exports to South Africa has been increasing absolutely and relatively. We should remember, however, that the figures for part of 1914 and for the years 1915 to 1918 are for a period when England was at war. However, the figures for the years 1907 to 1913, and for 1919 and 1920, do not lead one to a different conclusion from that arrived at above. What the future trend of South Africa's import trade from preference and non-preference countries is going to be cannot be dogmatically predicted.

In 1906 the tariff was revised, and preference considerably extended. Yet the figures showing the respective percentages of the exports of the United Kingdom and of the United States of America (exclusive of specie) to South Africa for the years 1907 to 1922 will bring out the claim made in the preceding paragraph, (1):

Country: 1907 1908 1909 1910 1911 1912 1913

United K'dom 56.8% 56.2% 58·1% 59.1% 58.3% 58.0% 54.4% United States 7.9% 8.2% 8.1% 7.9% 8.1% 9.0% 9.5% 1914 1915 1916 1917 1918 1919 1920 1921 1922

56.6% 58.4% 58.7% 52.5% 54.1% 45.5% 53.8% 54.8% 54.2% 9.7% 15.1% 15.7% 9.4% 117% 24.1% 18.2% 15.5% 11.8%

The year 1920 was, to be sure, the culmination of an abnormal period. Unless great changes are brought about in the situation, so as to make competition still more uneven, one might be able to get a good view of the movement after the pound sterling rises to a reasonable basis.

1. Value of United Kingdom and United States merchandise imported into South Africa for the years 1907 to 1922: Value in pounds sterling). — (000's omitted).

1907 1908 1909 1910 1911 1912 1913

23,300

21,000 51,000 41,948

35,448

1914 1915 1916 1917 1918 1919

16,700 16,100 21,500 17,400 3.139 4,566 6.000 6,250 7,000 11,250 17,000 8.574 6,006 See Cd. 7023; Report of the Trade and Shipping of the Union of South Africa for the years 1918, 1920 and 1922. Board of Trade Journal for May 27, 1920, p. 704; Cd. 9155, etc.

M. Lemonnier also seems to hold that Milner's policy had not ⚫ the desired effect. See note on previous page as to the reference.

The same holds true of the other countries which do not share preferential treatment in South Africa. Let us take the case of Germany before the war. Germany's percentage of South Africa's total import trade was as follows:

1907 1908 1909 1910 1911 1912 1913 1914 (1).

7.6 8.7

9.0 10.4 9.8

9.0

8.8

7.0

Up to that year

Here is noticed a relative decline after 1910. there was a rapid expansion. There was also an absolute decrease in the amount of Germany's export trade to South Africa-perhaps due to Germany's exploitation of the South American market at about this time. (2).

These figures and those for the United States from 1914 to 1918, labour under the defect that they are for a period England was at war, but so was the United States after 1917, and besides, the United States had to furnish the Allies with many materials. Nevertheless, the market once gained, might not be given up at all especially when things become normal again. (4). In his annual report to the Board of Trade on the trade of the Union of South Africa for 1919, Mr. Wickham, His Majesty's Trade Commissioner in South Africa, writes (5): To all interested in British manufacture, whether as importers, agents, or consumers, it has been a year of disappointment. British trade with South Africa has gone down and American trade has gone up." And Mr. Wickham expected so much from "Accurate, reliable British quality superimposed on the American staple of cheap mass production, with a standardization far more close than has ever been attained by our rivals." He proceeds: "The British per

1. 1914, up to August.

2. For German exports to South America see Statesman's Year Book, 1914, p. 913; see also Cd. 7023.

3. See Cd. 9155.

4. It should, moreover, be remembered, that American foreign trade is better organized now than before the World War. This is due to the passage of the Webb-Pomerene Law, which allows the formation of export associations and frees them from the application of the Sherman Anti-Trust Law (1890). Nearly 60 export associations have been formed under the Webb-Pomerene Law.

5. See Board of Trade Journal, September 23, 1920; Cd. 956.

155