Aug.
Since the retaliatory measures adopted against Australia in connection with the textile embargo, close attention is being pald by more than one Pacific nation to the efforts of Japan to ensure supplies of wool for her expanding woollen industry now that relations have been severed with her principal supplier, Unlike Mary in the nursery thyme, the close attachment a progressive nation like Japan maintains for such a fleecy subject provides no cause for "laugh and play" On the contrary, any solution of the problem which con-fiots with existing arrangements may mean a serious readjustment of the production and distribution of this commodity owing to the importance which the Japanese textile industry occupies as a factor In the international economic structure. In recent years, the Island Empire has shown amazing skill in filling the deficiencies in her very limited range of natural resources by ex~ pedient which are novel in conception, but which have been dictated by vital national needs. 'The recent petroleum arrangement ensuring six months' supply of this essential product which Japan lacks is an example of this thoroughness of application, By this arrangement, legalized under the Oil Control Bill, foreign companies who sell to Japan will "maintain constantly stocks equal to six months' normal re~ quirements with a subsidiary company responsible for the storage of half this quantity which foreign companies maintain is beyond reasonable business conditions to store in their own tanks. Iron, copper and other commodities have also been subjected to arrangements based on the country's determin: tion to make good national. d ficiencies.
Wool falls into a different category. By retaliating against Australia, Japan was defending her foreign trade policy which, notwithstanding the interpretations placed upon it by other countries which have introduced tariff walls and acts of discrimination, continues to be developed on lines which Japan's industrial capacity and cheap labour make possible. When Australia closed her doors to cheap Japanese goods giving preference to British Empire products, Japan answered by announcing her re~ fusal to purchase Australian wool. Hitherto, Japan's purchases of wool jorgely from the Dominion have amounted to approximately 750,000 bales a year, a quantity which has increased in relation to the increasing manufacture of woollen textiles once the virtual monopoly of other countries, principally Great Britain. This decision will have no immediate effect on the Japanese mills because it is estimated that present commitments amount to about 250,000 bales which is suff dent to meet, industrial demands for some time to come while a contraction of woollen exports would substantially extend the period of independence, In addition, there are South Africa and South America, both large wool producers who can be relied upon in an emergency and with whom Japan maintains much more favourable commercial arrangements, As a manquvre designed to remedy what Japan considers inequitable trade relationships with the Dominion, the situation is not beyond settlement. Both wool manu-
Jacturers and importers agree that an organ Is necessary to control wool imports but there is wide disagreement as to the method to be adopted. Importers demand control of wool from all countries.
Manufacturers demand that contro} should apply only to Australian wool in order to enforce retaliatory measures and obtain better terms.
The manufacturers, in deciding in this manner, also foresee the possibility of placing the industry at the merey of the importers if complete control is introduced.
While this divergence of opinion exists there is hope that a satisfactory settlement will be reached in this dispute between two great Pacific nations, which are such important links in the world scheme of interdependence of producer and manufacturers, but there are dications that whatever form. it takes it will be merely temporary for this gesture' of independence in regard to another important commodity is another manifestation of Japan's policy of self-sufficiency which has been so successful in other directions. Japan is not a great pastoral country with large farms capable of maintaining the hundreds of thousands of heads of sheep needed to meet normal demands, but efforts to remedy, at least partially, this defect have been energetically undertaken in recent] years. Concentration on sheep and [cattle breeding has been tremendous in order to improve the stock and jinerease the herds, An illustration lof this development is provided by the announcement of the President of the Kanegafuchi Spinning Company, one of the largest concerns in the country, of a plan for establishing ten pastures in six prefectures with financial assistance for the farmers from whom the company will purchase the wool. The company expects to accumulate a herd of 10,000 sheep on these ranches and are confident of the success of the scheme for, as the President pointed out, small scale sheep farming is suitable to Japan and should contribute something to} the achievement of self-suflciency of raw wool in this country." This} is only a slight beginning and will have "no appreciable results for years. On the other side of the China Sea, it is only natural that] the situation may be regarded in a different light, and the apprehension may exist that, faced with another vital problem of essential supplies. Japan may be casting her eyes to more fertile areas on the mainland to develop this self-suMiciency. Manchuria's fertile fields provide one solution: another is the sweeping plains of Mongolia. where the tribesmen of Ghenghis Khan fed' and watered their flocks and continue to do so to-day. The "Shun Pao," which is not generally given to alarmist opinions, a few days ago foresaw another warning of penetration in the adverse outcome of /the controversy with Australia, but although this is taking an extremist view it would be imprudent to assume the impossibility that forces which have driven other countries to seek solutions of economic prob-Jems abroad might not operate in the case of Japan and her wool supplies,
Text read from the printed page and cleaned; old type leaves the occasional error.