GERMANY: ONE OF OUR BEST CUSTOMERS.
In the previous chapter it was shown that the general figures of our
import and export trade gave no indication of the ruin of our commerce
either by Germans or by anybody else. In the present chapter it is
proposed to show that though Germany is among the keenest of our trade
competitors, she is also one of our best customers. For a sufficient
indication of the truth of this proposition we have only to turn to the
annual statement of the trade of the United Kingdom. It is true that the
figures there published are not entirely satisfactory, because much of
the trade of Germany is shipped from Dutch or Belgian ports, and
credited to Holland and Belgium respectively. But this is probably also
true, and to about the same extent, of British goods destined for
Germany, and travelling _viâ_ Belgium or Holland, so that in comparing
imports and exports this factor may be neglected. The same cause of
error will probably be also present to the same extent in successive
years, so that we can ignore it when comparing one year with another.
Purely for comparative purposes then the annexed table, and the diagram
illustrating it, are sufficiently accurate, although the actual figures
for any one year by itself have, for the reasons given, little positive
value.
OUR TOTAL TRADE WITH GERMAN PORTS.
In Millions Sterling.
----------------------+----+----+----+----+----+----+----+----+----+----
|1886|1887|1888|1889|1890|1891|1892|1893|1894|1895
----------------------+----+----+----+----+----+----+----+----+----+----
Imports from Germany |21·4|24·6|26·7|27·1|26·1|27·0|25·7|26·4|26·9|27·0
Exports to Germany |26·4|27·2|27·4|31·3|30·5|29·9|29·6|28·0|29·2|32·7
----------------------+----+----+----+----+----+----+----+----+----+----
These figures may be illustrated diagrammatically as follows:--
[Illustration]
A VERY SATISFACTORY TRADE.
These figures furnish a striking answer to the alarmists who can see in
Germany nothing but a vigorous and not too scrupulous rival. In every
year during the last ten years she has apparently bought more from us
than she has sold to us. It is quite true that all the things she has
bought from us were not produced or manufactured by us. A portion of her
purchases consists of foreign or colonial goods sent to London, or
Liverpool, or Hull, and there purchased for re-sale in Germany. But in
the same way some of the goods we buy from Germany certainly had their
origin in other countries, and have only passed through Germany on their
way to us; so that the fairest way of making a comparison is to take the
whole trade in each case. Moreover, this _entrepôt_ trade of ours is not
in itself a thing to be sneezed at; it contributes a goodly fraction of
the wealth of the city of London. In order, however, to complete the
picture of our trade with Germany, the following table is appended,
distinguishing in each of the ten years under review the home produce
exported from the foreign and colonial goods re-exported. This table
shows that in purely British goods we are doing a very satisfactory
trade with Germany. Taking averages, we see that during the ten years
our export of our own manufactures and produce to German ports was at
the rate of £17,800,000 a year, against a total import from German ports
of £25,900,000, this figure including both German goods and other
countries' goods passing through Germany. If we recollect that on the
whole our imports from the outside world must be very much larger than
our exports, for the reasons detailed in the preceding chapter, it will
be seen that these two figures, even by themselves, are not
unsatisfactory.
ANALYSIS OF OUR TRADE WITH GERMAN PORTS.
In Millions Sterling.
----------------------+----+----+----+----+----+----+----+----+----+----
|1886|1887|1888|1889|1890|1891|1892|1893|1894|1895
----------------------+----+----+----+----+----+----+----+----+----+----
British Goods exported|15·7|15·7|15·8|18·5|19·3|18·8|17·6|17·7|17·8|20·6
to German ports | | | | | | | | | |
| | | | | | | | | |
Foreign and Colonial |10·6|11·5|11·6|12·8|11·2|11·1|12·1|10·3|11·4|12·2
Goods exported from | | | | | | | | | |
British ports to | | | | | | | | | |
German ports | | | | | | | | | |
----------------------+----+----+----+----+----+----+----+----+----+----
OUR PRINCIPAL CUSTOMERS.
Let us now go a step further and compare our trade with Germany and our
trade with other principal customers. The comparison is worked out in
the following table, which shows the total imports into the United
Kingdom from the respective countries, and the total exports from the
United Kingdom to the same countries:--
TRADE OF THE UNITED KINGDOM WITH THE FOLLOWING COUNTRIES.
Ten Years' Average, in Millions Sterling, according to _British_
Returns.
----------------------------------+-----------+-----------
| Imports | Exports
| into U.K. | from U.K.
----------------------------------+-----------+-----------
From and to Germany | 25·9 | 29·2
" " France | 42·6 | 21·7
" " United States | 91·8 | 40·2
" " British India | 30·5 | 31·3
" " Australasia | 28·3 | 23·1
" " British North America | 12·2 | 8·4
----------------------------------+-----------+-----------
These figures are taken from the British Custom House returns, and are
subject to the objection to which allusion has already been made, that
the Custom House authorities have no means of ascertaining the real
origin of goods entering this country, nor the real destination of goods
leaving it. Thus, for example, everyone knows that there is a
considerable trade between Great Britain and Switzerland, yet
Switzerland has no place at all in the Custom House returns, because,
having no seaboard, all her goods must pass through foreign territory,
and each package is credited by our Customs House to the port--French,
or Belgian, or Dutch--through which the package passes to England. In
order, therefore, to provide some check on the above figures, I have
averaged in the same way the figures collected by the different foreign
countries in their Customs Houses. These foreign and colonial figures
have no more title to be considered absolutely accurate than ours, nor
do they cover quite the same ground. Their value lies in the rough
confirmation they give of the very rough conclusion which we are able to
draw from our own figures:--
TRADE OF THE FOLLOWING COUNTRIES WITH THE UNITED KINGDOM.
Ten Years' Average, in Millions Sterling, according to _Foreign
and Colonial_ returns.
-------------------------+-----------------+-------------------
| Exports to U.K. | Imports from U.K.
-------------------------+-----------------+-------------------
Germany | 29·1 | 26·6
France | 38·2 | 22·0
United States | 84·6 | 34·2
British India[1] | (Rx) 36·4 | (Rx) 60·4
Australasia[1] | 28·5 | 27·2
British North America[1] | 10·5 | 9·1
-------------------------+-----------------+-------------------
[Footnote 1: These figures include treasure as well as
merchandise.]
On the whole, these figures tally more closely with those derived from
British returns than might have been expected, and if we make allowance
for the fact that the Colonial figures include treasure, it will be seen
that both tables show that Germany is our best customer after the United
States and India.
THE ALARMIST'S ARTS.
In order to obscure this important fact, while alarming the British
public with the notion that English manufacturers are being ruined by
German competition, Mr. Williams picks out half a dozen or so items of
our imports from Germany, and then exclaims in horror at the amount of
"the moneys which _in one year_ have come out of John Bull's pocket for
the purchase of his German-made household goods." He prefaces his list
with the unfortunate remark that the figures are taken from the Custom
House returns, "where, at any rate, fancy and exaggeration have no
play." That is so; the fancy and exaggeration are supplied by Mr.
Williams. In 1895, he says, Germany sent us linen manufactures to the
value of £91,257. He omits, however, to mention that according to the
same authority--the Custom House returns--the value of the linen
manufactures which we sold to Germany was £273,795. Again, he mentions
that we bought from Germany cotton manufactures to the value of
£536,000, but he is silent on the fact that our sales to Germany
amounted to £1,305,000. He does not even hesitate to pick out such a
trumpery item as £11,309 for German embroidery and needlework, but he
forgets to tell his readers that the silk manufactures which in the same
year we sold to Germany were worth £92,000. In the same way, were it
worth doing, one could go through the whole of Mr. Williams's list,
pitting one article against another. It would be labour wasted. The
simple fact is that, according to the authority upon which Mr. Williams
relies for all the figures just quoted, our total exports to Germany
exceed our total imports from Germany, and no trickery with particular
items can destroy, though it may obscure, that broad fact.
A SELF-DESTRUCTIVE POLICY.
But, for the reasons already explained, in replying to Mr. Williams I do
not rely wholly on British figures. It is from the double testimony of
British and foreign figures that I deduce the fact that of all our
customers Germany is one of the best. The practical moral of this fact
is sufficiently obvious. In private business a tradesman does not go out
of his way to offend a good customer, even though that customer is also
a keen trade competitor. He bestirs himself instead to keep ahead, if
possible, of his rival without doing anything to destroy the mutually
profitable trade relationship between them. Such palpable considerations
of expediency are ignored by our latter-day Protectionists, among whom
Mr. Williams deservedly ranks as a leading prophet. Their ambition is to
induce the Colonies to discriminate in their tariffs between goods from
the Mother Country and goods from foreign countries, admitting the
former on favourable terms and penalising the latter. It is avowedly
against German competition that this policy is directed, and we are
light-heartedly told to risk our trade with one of our best customers on
the chance of encouraging trade with Colonies which so far have shown
much more eagerness to sell their goods to us than to buy ours. Even
supposing that this policy succeeded in destroying the whole of the
German export trade to our Colonies and Possessions, the possible gain
to us would be very small.
Here are the figures of the trade of our three principal Colonies with
the United Kingdom and with Germany, derived in each case from the
Colonial returns:--
TRADE OF THE FOLLOWING BRITISH POSSESSIONS WITH THE UNITED KINGDOM AND
WITH GERMANY.
Ten Years' Average, in Millions Sterling or Millions Rx.
-----------------+---------------------------+----------------------------
| IMPORTS. | EXPORTS.
+---------------+-----------+---------------+------------
| From Germany. | From U.K. | To Germany. | To U.K.
-----------------+---------------------------+----------------------------
India (Rx) | ·9 | 58·4 | 3·8 | 36·4
Australasia | ·9 | 27·4 | ·7 | 28·2
Brit. N. America | ·8 | 9·1 | ·1 | 10·1
-----------------+---------------+-----------+---------------+------------
Thus these great groups of Colonies and Dependencies together buy rather
less than £3,000,000 worth of German goods against more than £60,000,000
worth of British goods. Yet in order to crush this fractional
competition of Germany in neutral markets, in order to scrape up these
crumbs that have fallen from our table, we are invited to risk the loss
of a direct trade with Germany worth nearly ten times as much as all the
crumbs heaped up together.