Tonga’S Trade In 1932.

Review by Chamber of Commerce.

THE following is the annual review of the trade of the Kingdom of Tonga, for the year ended De cember 31. 1932, which was submit ted to the annual meeting of the Tonga Chamber of Commerce by the President (Mr. J. H. Young). The meeting was held in Nukualofa on February 20, 1933.

Chamber Of Commerce

Meetings.

During the year eight meetings were held and have been well attended. Mat ters of general interest to the commer cial community have been brought up and discussed by the Chamber, and two subjects of major importance to the con duct of business have been brought be fore the Government of Tonga, viz.: (1) the Contract Act and (2) the renewals of leases. In the former case the Gov ernment has not been able to see its way to making any amendment, either to facilitate contracts with natives or the recovery of smaller debts; in the latter nothing further has transpired so far.

Trade.

Both imports and exports during 1932 show but an infinitesimal increase over the low figures of 1931. The figures for the past nine years have been;

Copra.

The total exports for the year 1932 amounted to 8323 tons valued at £83,228 f.o.b., a decline in quantity of 606 tons, but an increase in value of £ 2867, which for all practical purposes means no im provement upon the dismal record of 1931. Of this £83,228 f.o.b. value, a large proportion must be deducted for labour, transport, bags, wharfage, shipping and export tax. Taking the average price during 1932 the amount paid to the European and native producer was about £58,000, the balance of about £25,000 going in the above-mentioned charges.

Merchandise.

In addition to the lack of purchasing power by the natives, what little move ment there has been of stocks has been at unremunerative prices in many lines.

The importation of cheap Japanese lines has rendered the reduction of prices to below landed cost a necessity, involving actual loss in the transactions, to say nothing of overhead expenses.

The year just ended has been a very bad one for those who have capital in vested in trade in Tonga, and very heavy losses have again been incurred.

Copra exports for the past nine years have been:—

a fall in value over the period of 72 per cent.

Prospects for the 1933 crop are so far good, provided always there is no blow during the present hurricane season, but members of the Chamber who are in terested in the purchase and export of copra will be well advised not to allow themselves to be carried away on any wave of undue optimism and to give due attention to the quantities exported dur ing the years 1931 and 1932. Whatever increases there may be in quantity may be easily offset by the fall in value. And on the present basis of taxation the purchasing power of the native must be regarded as practically nil.

The figures of Government Expendi ture as appear in the estimates passed by the Legislative Assembly for the past nine years are as follow:

a decrease over the period of 6 per cent., or practically the same expenditure on an exported value of £94,176, as it was in the year 1924 on an exported value of £306,658 —i.e., while the Kingdom pro duces to-day an income of less than one-third of what it did then, the ex penditure by the Government remains for all practical consideration the same.

Exports.

The following is a statement of the entire production exported by the King dom during the year 1932:

Imports.

Exports.

Total. 1924 £232,600 £306,658 £539.258 1925 258,322 290,115 548,437 1926 227,882 263,198 491,080 1927 235,391 393,174 1928 211,907 287.668 499,575 1929 198,078 259,090 457,168 1930 148,306 183,204 331,510 1931 81,170 90,596 171,766 1932 86,006 98,163 184,169

Year. 1924-5 Amount. 1925-6 71,938 1926-7 1927-8 84,255 1928-9 81,382 1929-30 1930-31 84,555 1931-32 ... 69,045 1932-33 63,599

Articles.

Quantity.

Value.

Copra, tons 8,323 £83,228 0 0 Fungus, tons 272 0 0 Bananas, packages 47,659 10,451 0 0 Cocoanuts, packages 63 5 0 0 Curios, cases 4 16 5 0 Hides 320 92 0 0 Live stock, pigs 4 4 0 0 Oranges, cases 58 8 0 0 Pineapples, cases 368 50 0 0 Poultry, crates 1 3 0 0 Produce, packages 295 42 £94,176 0 0 0 0 an increase of £11,359 over the year 1931.

Tons. Value. 1924 14,533 £297,487 1925 13,750 280,386 1926 13,992 255,156 1927 11,252 225,044 1928 15,671 282,083 1929 16,860 252,911 1930 14,134 169,610 1931 8,929 80,361 1932 8,323 83,228

It should be noted that this total is the f.o.b. value of the produce exported, and, consequently, does not represent the amount paid to the producer, but for purposes of comparison the gross totals of produce exported and Govern ment expenditure are taken, to the ma terial advantage of the latter. It must be borne in mind that the taxable in come of a country is very different from the f.o.b. value of its exports. The amount received by the producer out of this £94,176 would be, at a generous esti mate, not more than £63,000, and this figure must be regarded to-day as the taxable income of the Kingdom. Is it any wonder that for the last financial year ended June 30, 1932, the Govern ment revenue is £14,090/13/4 less than their estimate, and £3523 down for the

first quarter of the current financial year?

The Government of Tonga budgeted for £65,995 for the current financial year, about £10,000 of which is obtained from rents and interest, and remainder by taxation. If this amount be realised there would be left a margin between it and the f.o.b. value of the exports of £28,181. That is to say, even on that basis, £65,995 for the Government, and £28,181 for the native population, the commercial community and the rest.

Such a condition is manifestly absurd, and calls for the situation to be faced by drastic economies, both in Govern ment undertakings and personnel, rather than a reliance year after year upon a wave of artificial optimism.

Bananas.

The shipment of bananas to New Zea land has continued regularly during the year under review. The packing of the fruit is not yet satisfactory, but that can be remedied if attention is given to what the New Zealand market requires, and the packers instructed accordingly. Some of the bananas are also cut rather too full during the summer months, thereby ripening too soon, but this also can be remedied by a little more experience in gauging the condition of the fruit while still upon the plant and the number of days between cutting and retailing in New Zealand.

The financial aspect of the business, however, is not at all what we were led to expect. While the value of the 47,659 packages exported during 1932 is given at £10,451/16/4 f.o.b., the pro portion of this going to the European and native producers was £4796/8/-.

Shipping.

The following are the figures for the past nine years;

The Chamber of Commerce expresses its thanks to Messrs. Burns, Philp (South Sea) Co., Ltd. for the use of their offices for the meetings of the Chamber.

Conclusion.

From the foregoing report it will be seen that a new economic basis has been brought about in this Kingdom by the heavy fall in the value of all commodi ties dealt in. The value produced by the Kingdom, as the figures quoted above demonstrate, has markedly fallen, thus reducing importation as a natural corol lary, both factors causing a restriction of trade, and materially reducing the Government’s revenue as a consequence.

There is at present not the slightest sign of any improvement, and it would appear that the commercial community must be prepared to face further losses, and the Government of Tonga, unless its expenditure be reduced by several thou sands per annum, to continue its drift, slow but sure, towards financial con fusion.

Inward.

No. of Vessels.

Tonnage. 1924 32 87,250 1925 41 77,704 1926 34 81,424 1927 29 62,605 1928 79,158 1929 37 83,039 1930 32 83,245 1931 27 64,621 1932 34 62,454 Outward. 1924 31 83,762 1925 37 74,067 1926 32 81,271 1927 25 58,252 1928 32 79,092 1929 34 81.243 1930 29 79 778 1931 28 68,246 1932 34 62,454