The outbreak of distilling in Canton resulted ina heavy loss of re-Yenue to the National Government, for imports of kerosene fell with a thump. To protect the revenue, the Government, instructed—the Customs authorities to introduce a bonding scheme under which fud oils imported for genuine industrial purposes were charged the uses! uty, bat fuel oils imported for dis-filiation (under licence) were liable! to pay an additional duty of about 15 cents, a gallon. Unfortunatel for the Government, the distillers' interest in Kuangtung Was 0 strong that the bonding scheme was effec: failure, the Government was not daunted." It theroupon sought to. protect. its revenue bby another method, Tt introduced new scale of duties on fuel oils, Tight gas oils being called upon to pay an increased duty, of about. 15 cents. a gallon, while kerosene dis-tillotes" "(having a high kerosene content) were called upon to pay The Provincial authorities attempted to explain that this discrimination was in fact only a form of subsidy given to local enterprise, 'That explanation was not in accord the facts and, moreover, it entirely ignored the fundamental principles of fair trade and, course, was inconsistent with' the Government's declared policy of encouraging foreign capital to develop, industries.
On the top of this handicap to foreign enterprise there is, for the Government at Nanking, the serious fact that it is losing much revenue by the action of the Kuangtung. provincial authorities, who are also in receipt of subventions from the Government.
Crude Oil No Solution has been suggested by some that the import of crude elf would meet the case, because the refining Jot crude oil and production from {of kerosene is an enrively scientific process. But the difficulty, in China, lies in' the fact that the quantity of crude oil required to. meet. the normal demand. for kerosene el would be 20 large that there would bean enormous wastage of by-products for which no use could be Found in this country. In other countries, where conditions ave less Backward, this problem would not arise. "Tu, the present state of China's industries it is not @ prac tical solution.
Obviously the situation is, in the main, the outcome of the dimeulty Which Nanking experiences in controlling the. operations of the South-West Council, Local intoresta alert and govern the actions of the local authorities; and while Nanking is bemoaning. the lot of revenue, especially as tt is also aube sidizing' Canton, it finds it. quite impossible to. ehforee regular. thods of imposing Customs dut Consequences Arising Thewe are two points which seem, to arise. First of all, the Govern. ment's policy of encouraging Toco industry should be pursued on, buslness like lines and without prejudice, to ite supplementary policy" of make ing wso of foreign capital, Second! the irregularities which" have bet allowed to creep in have seriously Yesduced the Government's collect. proposed that all auch la ye the same import duty as kerosene. ing resources and must, in (iv long. lowed exclusively by the Afunic 'Again the Government was baulkrun, react unfavourably. on the yet Greater fla Jed. "The South-West Political Counfeconomie conditions inthe country Pristan and New Town nearly cil which is. the very' independent fand, particulars, on the. volatic Jail the land is held on the baste of authority in power in Kuangtung, between the Government" and Ca leases concluded with the Chinese prevented the' Canton Customs off ton. Foreign traders. find it most Eastern Walls; rs from putting the new fuel all unsatisfactory to be involved in'
Owing to these facts some sur-duty scale into effect, constant struggle with the reulaforks Department of the Manil Sve fe expressed here that the
Text read from the printed page and cleaned; old type leaves the occasional error.