A South for Our North

The potential trade between Canada and the West Indies is estimated at $300,000,000 a year. In 1926 it was $32,000,000. Do we want the rest of it?

HORATIO C. CROWELL December 1 1927

A South for Our North

The potential trade between Canada and the West Indies is estimated at $300,000,000 a year. In 1926 it was $32,000,000. Do we want the rest of it?

HORATIO C. CROWELL December 1 1927

A South for Our North

The potential trade between Canada and the West Indies is estimated at $300,000,000 a year. In 1926 it was $32,000,000. Do we want the rest of it?

HORATIO C. CROWELL

AS A Royal Mail Steam Packet liner drew out from her dock on her departure from Halifax one night early this year, two men stood watching her from the vantage point of the end of one of the great piers of the ocean terminals. As she swung into the fairway, and her engines responded to the impetus of the broadening stream, a rocket shot up from the stern of the ship, spray-

ing the air with globules of light, for a moment lifting out of darkness the grim fortress of George's Island, and throwing it back into the night again.

“What’s the signal for?” asked one of the men on

”1 suppose she’s saying goodbye, the old ship is not coming back. This is the last sailing of the iast ship of the Royal Mail in the West Indies trade,” replied his companion.

"You don't mean to tell me that the trade has fallen off to that extent,” exclaimed the first man.

“Not on your life,” rejoined the other. “The trade has such possibilities that the Canadian Government has taken a hand in it.

Within a few months you will see the finest transportation service on the Atlantic, out of this port for the British West Indies, and

Canadians should get a bigger slice of that southern

“You mean the Canadian Government Merchant Marine? Well, my guess is they have a long way to go to

build up that trade.”

“Yes. I mean the C. G. M. M., and it’s not as long a

frail as you think,” retorted his friend. “And if you want the proof, it's right there in that shed,” he added.

From Matches to Pure-Breds

TIN SIDE the warehouse night shifts of stevedores and

doek laborers were engaged in loading a C. G. M. M. ship for the British West Indies. The long building, reeehoing the sound of steam winches on the ship, and shouts of orders for the slackening of ropes, or the guiding 0: heavy loads of merchandise, as they were swung from the floor of the pier to the holds of the steamer, were it. striking contrast to the quiet harbor waters over which the^oTier liner was making her way to the sea.

it seemed, at first sight, that the place had become a flour warehouse, but on closer examination it became

apparent that, while the flour loomed large in bulk, there was a greater variety of merchandise than a mental note pad would register. Back in the shadows was a pyramid

of wooden boxes, the stamp on which showed them to be filled with rubber soled shoes. Nearby were other pyramids of boxes containing condensed milk, canned fruits and vegetables. Still farther back were piled boxes containing tins of butter, and great heaps of bulging potato sacks. There were tiers upon tiers of cordage, boxes of biscuits and bread» bags of cement, cases of hardware and cutlery. And still the inventory grew—lard compounds, paints and varnishes, furniture, paper,

cottons, brooms, whisks and whiskey, trunks and valises, matches, stationery, machinery, cheese, sugar, meats . . .

The, examination was interrupted suddenly by the loud grinding of train brakes just outside the shed.

“What’s that?” both men asked a dock foreman. “Cattle train, Pure-bred live stock going down to Barbados and Trinidad,” answered the docker.

“Cattle, eh,” mused one of the visitors. “Looks as if this West Indian trade is bucking up.”

“Buckin’ up!” retorted the foreman vigorously. “These here cargoes are the biggest that ever went out of Halifax for the South, and that’s sayin’ somethin’, for they’ve been goin’ out ever since the place was made. They’re doin’ more than eatin’ watermelons down in Bahaymy these days. Look at it,” and he indicated with his arm the piles of goods.

The visitors looked, and looked again as the foreman went about his business of directing a gang of men who were demolishing a small mountain of casks of fish, while the winches roared away and the steel ropes raced through the blocks and great dangling bundles of merchandise were swallowed by gaping hatchways.

Breaking the U. S. Stranglehold

THE Royal Mail liner’s, last salute was more than a signal of farewell; it signified the passing of the old and the beginning of the new era in the Canada-West Indies trade. It signified the fact that the new trade treaty between Canada and her British sisters óf the Caribbean Sea opened the doors of opportunity wide and the old order had to pass to make room for the new.

What those men saw in the shed of the ocean terminals, that night, was merely one small illustration of the possibilities inherent in our growing trade with the British islands of the Caribbean. “You can sell anything in the West Indies but furs and furnaces,” said a trade agent recently returned to Canada. Canadians have been slow to appreciate the significance of that truth, but in the face of trade agreements far less advantageous than those now in force and with transportation facilities so inadequate as to fall far short of meeting the demands of modern trade, the exchange of products between the British Wést Indies and Canada increased from $3,500,000 in 1900 to $32,000,000 in 1926.

For many years the Canada-West Indies trade was a system of barter, whereby principally the fish, pota-

toes, and lumber of the Maritime provinces were exchanged for the sugar, molasses, fruit and rum of the West Indies. The trade long since passed the swapping stage. The ‘codfish-molasses aristocracy’ and its family compacts, which more or less monopolized the trade in Nova Scotia in the early days, now are tradition.

Today, the existing trade agreement with the West Indies is another step toward effecting what may and has been termed, a marriage of the temperate with the tropical zones. Every northern product which the West Indies consume, can be produced in this country. Every tropical product which Canadians consume can be produced in the British West Indies, in quality and quantity equal to that produced in any other part of the world. The present treaty suggests what may be accomplished within a few years, namely, permanent commercial union whereby Canadians will take away entirely all tariff barriers to the products of the British West Indies, and so far as trade is concerned, make the Dominion and the colonies of the Caribbean as one.

More than that, the present trade treaty with the West Indies strikes directly at the system of having West Indies products for Canadian consumption supplied through American channels. For years Canadians have paid the price of having West Indies products come to them from their own British Islands, in American bottoms to American ports, through American middlemen, and then sold through American agencies to the Canadian retailer, and, at last, reaching the Canadian consumer at a price that has contributed profit to a vast system of pyramiding at a price that not only put the products of our own British Islands almost altogether out of the reach of our average citizen, but in many instances placed us almost entirely in the hands of American fruit combines.

If we purchased from those British Caribbean countries all the tropical products we consume in Canada— and they are capable of producing them all—we would divert to their coffers another one hundred million dollars. If, in turn, they spent with us for the northern products they require, a fair proportion of that increased revenue, the trade between Canada and the British West Indies and British Guiana, to-day would measure close to two hundred million dollars.

This trade already has developed into an exchange of a very wide variety of products. Its substantial development during the past twenty-seven years has been the result, not of a few individuals enjoying their commercial adventure, but the result of the working of subconscious instinct, the working of that desire of all northern countries to seek southern counterparts, from which they may secure their tropical foods and materials with as little difficulty and as cheaply as possible.

Marriage with a Tropical Zone

TIT-HEN Lieut.-Col. L.C.

* * Amery as Colonial Secretary in the British Government, attended

the West Indies Conference which was held in Ottawa in 1920, for the discussion and revision of the then existing treaty between Canada and the West Indies, he made the following statement, presumably with the imprimatur of the British Government upon it:

‘The whole essence of modern development lies in that marriage of the temperate and tropical zones in which each can find its greatest development and prosperity.

‘The welfare of the Dominion of Canada lies not only in the development of her own internal resources, but, also, in employing the energies of her people, her manufacturing skill, her enterprise, and her capital in the development of the tropical regions of the Empire. They are her Empire just as much as they are the Empire of the United Kingdom. This is particularly so in the case of the part of the Empire which is so near to Canada as the West Indies.’

In that statement we have the keystone of this structure of trade. To expedite the marriage of Canada to her great southern affinity, we must have the best possible system of trade and the most modern transportation facilities.

Going back to 1898, and covering the years between, the Canada-West Indies trade may be regarded as having developed in four different stages. First, we have in 1898, the Canadian Government extending the British preference to British Guiana, and the West Indies. Incidentally, the application of the preference to sugar practically saved British Guiana from financial ruin. From 1898 to 1913, such impetus had the trade obtained between the two countries, that in the latter year there was little difficulty in negotiating a treaty whereby reciprocal lowering of tariffs was effected, and preference granted one to the other. This new era of trade was marked by the establishment of an improved transportation service, and the Royal Mail Steam Packet Company was induced, under liberal Canadian subsidies, to place four boats between St. John and Halifax, and Bermuda,

the British West Indies and British Guiana, providing a fortnightly service, according to the terms of the treaty-.

The third phase of our relations with the southern countries opened in 1920, when the trade, feeling the encouragement already given it,

sought for downward revision of the tariffs. Delegates from the West Indies and British Guiana met the Canadian representatives of the Trade Department in Ottawa, in 1920. In directing this era of development, Sir George Foster, then Minister of Trade and Commerce, was perhaps the most potent factor. His appreciation of the value of these countries to Canada was an influence that permeated the Islands with stronger feeling toward the Dominion.

The fourth stage opened in 1925, when our government appointed the Canada-West Indies Commission, which, with H. J. Logan as its head, toured the Caribbean Sea. countries in the early months of that year, visiting alike British and foreign territories. Invitations were extended to all British countries of the south to send delegates to a conference at Ottawa. This conference was held in June of 1925. Tariffs had another downward revision; preferences were still further increased; definite clauses were written into the treaty concerning certain

important specific articles of trade and an ambitious system of transportation was outlined.

By the treaty, of 1S25, Canada grants a fifty per cent preference on all West Indies products imported direct through Canadian ports into Canada. In return, the West Indies make a substantial contribution to the subsidies to be paid to the new transportation services.

A Discriminating Market

T HAVE tried to show how important the treaty is, but this trade requires more than a treaty; it demands the closest study. Granted we have the preferences, we cannot abuse those preferences by sending any old thing in any old way we deem convenient. The countries of the Caribbean are steadily becoming more and more susceptible to the changing character of trade as influenced by the progress of modern production. For that reason it is absolutely essential that the Trade Department of

Continued on page 55

Though all the clauses of' the treaty are not yet in force: and the transportation facilities not fully provided for, the results of the free exchange of products between the two countries already are to be seen by any one who is sufficiently interested to watch the recorded sailings of the Canadian Government Merchant Marine ships from Montreal, or Halifax. It is a small thing in itself, but significant, that for the first time in history, ripe Bermudan tomatoes were shipped in through Halifax last season, although cold storage, or chilled space, lias been deplorably lacking.

A South for Our North

Continued from page 11

this country should keep fully abreast of that trend, and individual shippers cannot afford for one day to drop behind in an aggressive policy of trade penetration. The colored population of these countries, numerically predominant, is increasing its purchasing power under the impetus of emulation of other people, and through the influence of education. The white men of these colonies are very discriminating; you may meet them at any time in the leading clubs of London, Montreal and New York. One has but to examine some of the stock in the shops of Bridgetown, Port of Spain, Georgetown and Kingston to realize that what these people

want, they seek from the great markets of the world.

Then there is the opportunity for the West Indies producer. As I have already pointed out, there is a purchasing power in Canada for tropical products worth one hundred million dollars above the present trade, which should be available to the West India merchant and producer. So far the shippers of those islands have made little effort to place their products on our markets. Our purchasing from them is largely done,by ourselves on oui own initiative. If it is essential for us to study their markets and have our trade

Continued on page 57

Continued from page 54

representatives in their principal centres how much more essential it would appear to be that they, with this enormous trade awaiting them, should place their agents in Canada, and carefully, aggressively to pursue their commercial penetration of this country. In fact the West India merchant is entirely lacking in any aggressiveness in this respect. For instance, who ever saw display advertisements of Jamaica grape fruit, of which there is none better in the world, in Canadian magazines and newspapers, similar to those advertising to the Canadian consumer all the advantages and qualities of California fruit.

Then, again, these islands should be induced to produce for the Canadian market the quality and sort of fruit the Canadian wants. There is no reason under the blue skies of heaven why Jamaica should not be producing as fine a seedless orange for Canadian consumption as that which we import in enormous quantities from California.

These Islands should now have traveling representatives throughout the whole Dominion. They should have them in touch with all our varied requirements in tropical products. They should exhibit at every principal exhibition from Halifax to Vancouver; furthermore they should endeavor in every way to produce the quality and quantity of fruits andtropical vegetables that we require and desire. British Guiana, for example, has the resources for producing every pound of sugar that Canada requires, yet, in 1924, we purchased from Santa Domingo, a negro Republic, on the Island of Hayti, about 157,000,000 pounds of sugar, while Santa Domingo buys comparatively little from us, and with her we have neither steamship communication, nor any treaty arrangements whatsoever.

The Attack on the Banana Monopoly

"DUT taking things as they are, what does the treaty itself offer us?

It aims at three definite objects, increased trade, lowering the costs of tropical products in Canada, and diversion of more of the West India trade through Canadian ports and over Canadian railroads.

By the treaty, the Bahamas offer us a preference over all other countries of twenty-five per cent. British Guiana, Trinidad and Tobago, the last being a dependency of Trinidad, grant us a fifty per cent preference; the Leeward and Windward Islands grant us a thirtythree and one-third per cent preference, British Honduras the same, and Jamaica a preference of twenty-five per cent. These preferences are in the general section of the treaty. But in the special clauses of the treaty, there are even more interesting reductions of tariff. For instance, the Western group (Jamaica, Honduras and Bahamas) grant Canada on flour, a preference of two shillings per barrel, and on butter, cheese, lard, condensed milk, meats of all kinds, cured fish, apples and potatoes, a preference of not less than fifty per cent.

Of the eastern group, Trinidad, Barbados and British Guiana also grant two shillings a barrel on flour, and on apples they grant a preference of fifty cents a barrel. On b:ots and shoes there is a preference of not less than sixty-six and twothirds per cent., and on butter, per one hundred pounds, there is a preference of $1.50, while on condensed milk, per case of forty-eight pounds, one shilling preference is granted.

Jamaica presents one of the most interesting phases of the entire treaty. This has regard to the banana trade. For many years the production of bananas in Jamaica has been largely in the hands of the United Fruit Company of America. Canadians, who consume about two million stems of bananas a year, have been importing the Jamaica banana through American channels. They have been the customers of the United and

other fruit companies in the United States, and of them solely. In fact, the United Fruit Company has had absolute control of the banana trade of this country. Attempts to break the monopoly have been made from time to time in the past, but always have proved ineffectual. Canadian firms have imported shipments of bananas direct from their agents in Jamaica, only to find the Montreal market had in the meantime been glutted with shipments of the United Fruit Company. As a consequence there was absolutely no sale for the Canadian importations.

The Canada-West Indies treaty directly strikes at that stranglehold of our trade. It provides first of all that bananas when imported from the place of growth by ship, direct to a Canadian port, per stem or bunch, shall come in free as against a general tariff of fifty cents. In addition to this thrust against the American monopoly, the new government steamship service to Jamaica will be in a position to prevent any monopolizing of space by any private interests.

Providing New Ships for More Trade

CO MUCH for the treaty—yet all the ^ advantages it gives us over all other countries, will be entirely nullified unless proper transportation facilities are provided. There are, therefore, written into the treaty certain specific obligations in respect to transportation facilities, for the carrying out of which Canada has given her sacred bond. To appreciate fully what these obligations are, one should briefly look over the history of steamship connections between Canada and the West Indies for the past thirteen years at least. For many years prior to 1913, when under the first treaty Canada accepted certain obligations in this regard, the steamship service, between St. John-Halifax and the eastern group of the West Indies, and British Guiana, had been maintained by Pickford and Black, of which W. A. Black, present senior member for Halifax in the House of Commons, is now the head. This company received substantial Canadian subsidies for small steamers, and they maintained for that time, a fairly satisfactory service.

In 1913, this service was superseded by the Royal Mail Steam Packet Company of England, which on guarantee of $340,000 a year subsidy from the Canadian treasury, was to maintain a fortnightly freight and passenger service from St. John and Halifax, to Bermuda, Leeward Islands, Windward Islands, Barbados, Trinidad and British Guiana. At the time it was inaugurated, this service was adequate and a very great improvement over anything hitherto operating even from American ports to the West Indies. During the thirteen years of its operation Canada paid the company, approximately, $4,500,000 in subsidies.

In recent years the Canadian Government Merchant Marine placed ships on the route to the Eastern group of islands. There was considerable criticism of what was termed by shipping people an anomaly, that the Government should place their own ships on a route in competition with a line to which that same government paid a subsidy. Admittedly it did seem a bit of an anomaly, yet on the other hand it is safe to say that a large section of the business community found those ships very handy, as alternating with the ships of a subsidized line, and it may be

pertinent to say, that in view of the reeent showing of surpluses by the C. G. M. M. their policy in this regard was justified.

An entirely different situation pertained to the Western group of the Bahamas, Jamaica and Honduras. From Jamaica came the severest criticism of Canada for failing to meet her treaty obligations of 1920, under which this country undertook to give the island a satisfactory steamship connection with eastern Canada. From Jamaica came the most definite demands during the 1925 conference, that transportation facilities must be provided, and it is significant to note that the terms of the treaty relating to the preferences on bananas do not come into effect until such service is provided. At present the western route has two services. One is that of Pickford and Black, Halifax. This firm operates two small Swedish freight boats, operated under the Swedish flag, and manned by Swedes. Pickford and Black are agents in Halifax for the United Fruit Company —the greatest and most aggressive United States Company operating in the West Indies.

Tiie Canadian Government Merchant Marine has operated two of its best passenger and freight boats to Jamaica for several years, sailing from Montreal in the summer, and Halifax in the winter, and up to their limitations, have given a satisfactory service. But these services are not what Canada, in 1920, undertook to provide for Jamaica, and until the Dominion redeems her bond in that respect our relations with Jamaica, the largest and wealthiest British country of, the south will be unsatisfactory.

The present treaty stipulates that Canada shall provide a fortnightly mail freight and passenger service for both the Eastern and Western groups, together with alternating freight services.

The ships on the eastern route are to sail from Canadian ocean ports the year round; or in other words from Halifax and St. John. The purely freight and alternating service for the eastern group will be provided by sailings from Canadian River ports in summer and ocean ports in winter. This interpreted means that Montreal will have, in summer, the same freight service that is provided from Halifax and St. John, the year round, and that in winter the Maritime ports will have an actual weekly service with the Eastern group.

For these services, the islands of the eastern group and British Guiana are willing to pay their share, their total contributions of subsidies, as written in the treaty amounting, annually, to approximately $145,000, or nearly one-third what the Canadian Government has been paying for thirteen years to the Royal Mail Steam Packet Line for its ships.

The ships of the Jamaican, or Western route will sail from St. Lawrence ports in summer, and Canadian ocean ports in winter. The treaty stipulates that the ships in the Jamaican route shall be provided with refrigeration for about 70,000 stems of bananas. It provides also that Jamaica will be linked with British Honduras by a service that will connect with the regular liners at Kingston. The islands of this group are paying for the service approximately $90,000 annually.

It will be seen from these figures that the Islands and British Guiana have stipulated to pay annually a total of close to $230.000, which is more than two thirds of what Canada was paying annually to the Royal Mail Steam Packet Line alone. With the amount of subsidies that Canada has been paying, added to the loss on operation of our ships, which had to meet the competition of subsidized liners, the Dominion has actually paid out in recent years, between six and seven hundred thousand dollars annually, and then had no adequate cold storage, nor cooled air space provided for its perishable products. After paying out $5,000,000 to the Royal Mail line as subsidies over thirteen years, we now neither have the money nor the ships, nor the service.

It is worth while recalling in this connection, that while we were paying to the Royal Mail Steam Packet Line for the employment of their ships, not a Canadian, with the exception of an occasional medical officer, was ever employed on one of them, and no Canadian need apply for a berth on the Swedish ships operating between Halifax and Jamaica. There is also the very important phase to consider, namely, that improved Canadian Government Merchant Marine service out of Halifax, controlling the trade to the south, should be a very substantial factor in stimulating trade over the Canadian National Railways. Under the new arrangement the trade will be developed by Canadian ships, sailing under the Canadian flag, manned by Canadians and operatingfrom Canadian points.

Two Against Seventy-two

Y\ 7TTH trade obstacles lessened; with improved transportation services, there is a third factor to be considered; namely, trade agents. Canada has two such representatives in the whole Caribbean country, where the United States has seventy-two. Moreover, our [system of selecting trade agents is very open to criticism, particularly when the Civil Service Commission places the selection of Commissioners on the basis of academic training, rather than on a thorough experience with the intricacies of one of the most involved trades. Furthermore, no man over thirty-five years of age is eligible for appointment to the office of Canadian Trade Commissioner abroad, according to the Civil Service Commission regulations. A very logical criticism, it appears to me, is that no man, until he has attained the age of thirty-five years, has the experience, or the maturity of judgment, to be appointed to positions of such responsibility.

In one important Caribbean country, the Canadian representative was a former law graduate and clerk. Because he had passed an academic examination of the Civil Service, he was given one of the most responsible posts in the service, although his practical knowledge of the West India t.-ade, or for that matter any foreign trade, was only of such a perfunctory nature which his civil service preparations might give him. His office was in a sugar loft, which was windowless, and without lights at night. When important matters of trade in some other parts of the island should receive his attention he had to seek permission from Ottawa four thousand miles away, to travel a distance of sixty miles across country, or else wangle, through the grace of some sympathetic friend, a free motor ride to the place in question.

Our Great Opportunity

WE NEED, however, to do more than provide adequate channels for the flow of commerce. If Canadians aie in earnest in their desire for expansion of trade with these British countries, then our interests must go further than the buying and selling of each other’s products Canadian capital should be set to work developing those countries, and with that development will come expansion of our trade as naturally as the fruit garden grows with care and watering.

What Americans have done in Porto Rico—transforming one of the most unprogressive, backward islands of the south, into one of the most flourishing of American colonies, affording a market for an enormous amount of American products—can be done, relatively, by Canadians with any one of the larger islands, at least, of the British groups now within our treaty arrangements. What Americans have done in our own Island of Jamaica, directly under our own nose, is an object lesson. The reason that they have in the past controlled the banana trade of that island is because they put their own capital into the development of the plantations in that country.

Canadian manufacturers have, in these countries, a splendid opportunity to display their aptitude for foreign trade. Every one of the islands and mainland countries that have entered into this treaty with Canada should be studied by the Canadian manufacturer, first with a view of improving what ground he is already established upon; secondly, to find out what of foreign exports to those countries he can replace; and thirdly, how to increase the purchasing power of the population, either' by offering commodities of which they know nothing at present, or educating them to use many articles that have not yet been adopted by the people. And he must keep ever in mind that this trade must be studied with a view of giving the West Indian what he wants, how he wantit, and when he wants it.

One can hardly make a comparison of the fertility of these islands for it can surely be said, they are the richest islands in America. They are varied in climate and productivity. What one does not grow of tropical fruits and vegetables, and woods, another does. They combine in an extraordinary manner, subtropical and tropical products, not only in their aggregate number, but single islands in themselves. They produce everything that Canada requires in “tropical products. They are our southern counterparts.

The treaty goes a long way toward that time when all tariffs between these two countries will be obliterated. Can anyone give any logical reason why Canadians should tax themselves on essential tropical products grown under their own flag, any more than they would tax themselves on any food product grown within the Boundaries of the Dominion itself. The agreement signed in Ottawa, in 1925, is a long stride toward eventually adding to Canada, for the purpose of trade, at least, a great province of three million of people, of enormous production, of incalculable potential wealth. All the tropical production of those Islands and mainland territories under the British flag, within the Caribbean Sea, we require. All the northern products they require we produce. Could a more logical, more natural, more sensible system of trade be devised? We should marry them.