Reference has recently been made these columns to the new reulations promulgated by the Government with regard to the compulsory submission of all raw silk exports to the Shanghai Bureau of paction and Testing of Commer-'Commodities, which took effect on April 1. These regulations have een foreed upon the trade with 'a disconcerting haste, and buyers and sellers alike have been compelled to accept them on pain of savings their silk refused exportation at the Customs. It is an open question whether legislation of this sort can benefit any industry whole, but in this case it appears Ghat yet another barrier has been thrown across the already prece fous path of the silk industry of China The organization responsible for the present contretemps carries the imposing title of "The National Government of the Republic China, Ministry of Industry Commerce' & Labour, Shanghai Bureau of Inspection and Testinge of Con mercial Commodities, Testing Department." This Bureau last yenr acquired the plant of the Shanghai International Testing House, a branch of the New York Testing House, Me, The International Testing House has operated for a number of years on. thi market, but their Jack of offic status proved a handicap to their work, which however was of great benefit to the industry in the means provided for the settling of disputes and for the research work carried the ing of an old evil. The Foreign Silk Exporters Association fully supported the Bureau in their efforts. Meetings were held and a number of difficulties surmounted.
It became gradually evident, however, that subterranean forces were at work, First one class of silk was excluded from the regulation, then another, until now there is an imposing list of grades that are exempt from compulsory conditioning. Upon analysis it is now found that all the grades that were habitually the worst offenders in the tendering of wet silk for shipment do mot require to be conditioned, bu' are to be sold as before on the nett weight and that the grades which normally showed a gain in weigh are to be conditioned, this increasing the basis of purchase to more than the nett weight.
The silk industry of China is at the moment in an unhealthy state, Internal taxation has been directly responsible for a disturbing increase in the cost of production, which has robbed the filatures of any chance of making a profit. The industry should be carefully nursed if the present pessimistic tone of the trade fs to be changed for the better. It isa matter of some concern that there does not exist a. single body whose sole purpose is to promote and encourage the industry. In Japan this important work was undertaken by a special government department with the result that she now leads the world in the iveoduetion of silk. The estab li rent of this Bureau is the first mov the Chinese Government has The Bureau's initial step on assuming office was to publish in the press an official Government regul tion to the effect that all silk exports from Shanghai must. be con clitioned by the Bureau on and after February 1, The short notice given rendered the effective carrying out of the regulation an_ impossibility, and its enforcement was postponed until March 1, and again until April 1, at which date it took effect.
In oder that the public understand the issues involved, itis necessary to explain in more detail the requirements of the Bureai The method of ascertaining the weight of a valuable cargo such as is an important factor of the trade, Two bases of weight are dealt in, the nett weight and the conditioned weight. The nett weight is, of course, the actual scale-weight of a lot of silk and is the basis on which the exporter has in the past bought from the dealer. The conditioned weight. is the theoretical dry weight of the Tot plus 11 per cent. the latter being the internationally recognized normal regain of moisture. Thi the basis on which the consumes abroad buys from the exporter. Foch consuming market maintains its own conditioning house, which officially ascertains the conditioned weight of every lot of silk imported. No case exists in which the con-tumer has accepted the conditioned Weight of the market of—ati whether official or otherwise, It will be seen by this method that the consumer is fully protected from Toss by the acceptance of wet silk, and that the exporter is Jeff to protect himself, which he does by private conditioning tests Iwfore shipment. This is precisely. the method which up to now has governed all silk transactions Shanghai, Tt involves a. certain mount of hardship on the exporter or his"agent, because of a curious custom that for losses in condition-ug which do not exceed two per cent, the dealer cannot be held responsible. However, in certain grades of silk a gain in weight could normally be expected and the exporter was sometimes able to balance, off the one against the other. The system was far from ideal, but has nevertheless been common use for some considerable time, The effect of the new regulation that all silk exports would be of latly conditioned and that the con-clitioned weight would in future govern the buying and selling of bilk on this market, thus bringing China into Tine with other silk markets, scored at first to be of edded "Lencfit to the industry in made officially to control the silk dustry of China, and in this light is necessary to examine closely its probable effect on the trade, What of that patient beast, the exporter? He experiences a direct which will be decidedly em-~ssing in these days of slender What of the effect on the trade?
An evil existed, that of the sale of wet silk, and the Government [have avowedly come forward with a remedy. Instend of a remedy, the trade is faced what _is vi: tually an encouragement to cerin dealers to be dishonest. The very raison dete of the law is defeated, and its value as a pall tive for' the evil it is designed to combat is exactly nothing. This fact is known to and acknowledged by these dealers themselves, who are compelled to pay a sum to the Bureau in liew of conditioning and ere glad to do so if by that means they may continue to sell on the nett weight. This statement will Lear emphasis. These dealers have in the past sold on the nett weight and have thus benefitted by an excess of moisture up to two per cent. The Government have ostensibly stepped "in to put a stop to this practice and have stated that, this payment must be discontinued. A delegation thereupon waited on the authorities concerned, with the result that the payment is to continue. In order to assure that there shall be no loss of revenue to the Bureau, however, these dealers have agreed to pay to the Bureau a sum equivalent to the condition ing and transport expenses. In return, instead of ascertaining the conditioned weight, the Bureau will ascertain the nett weight only, and they desire that this nett weight shall be accepted by both bayer and seller.
This is ridiculous in the extreme, as all exporters are perfectly capable of obtaining their own nett weights and have done so with perfect. satisfaction to both sides since the beginning of the trade. The industry is in no way benefited, but on the contrary ie is strongly felt among exporters that having once set out to effect reform on this market they should have resisted the protests of interested parties. If it indeed proved impossible to resist these protests, then the regulation should have been. withdrawn altogether. Tu its present. form the result will be inevitable.
And what of the future? The principle of state interference with trade is, one that well gives pause to the most experienced politician and no step ig ever taken in the
Text read from the printed page and cleaned; old type leaves the occasional error.