BRITISH FOREIGN TRADE

(in millions) ReImports Exports exports £& & & TS OUR. cimelicS?: rma 4sOmr rammed Osc UU so ERS oe VRY oa GS EQUS Ss W68"0 Se O25°3 2. 109-6 Before the European War the United States and Germany were the only countries which had developed a foreign trade comparable in dimensions with that of the United Kingdom, and while both closely approaching this country in total value, calcus lating in proportion to population neither of these countries approached the British figures: UNITED STaTES IMPORTS AND EXports (in millions) Total Domestic Imports Exports £& £& 1901 oe 171°5 oo 304-3 ileal 318-2 oo 419-5 TOS 362-6 ate 485-7 520 FOREIGN TRADE GERMAN EMPIRE IMPORTS AND EXPORTS, SPECIAL TRADE (in millions) Imports Exports & & 1901 no 266-5 oe 217°9 1911 an 477-2 oe 398°5 1913 a3 560-3 on 70 FOREIGN TRADE IN 1913 (per head of populaton) 8g United dingdom.17.. 12 United States BS Ola 250 en Sto. German Wmpire. 9:4.. 8:1..17°5 Post-War. The European War of 1914-8 cut acro the lines of trade which had developed during the nineteenth century, and the reconstruction of international trade is perhaps the most serious and difficult problem of the post-war period. The figures of trade returns, owing to the great fall in the value of the money in which they are stated, should only be compared with pre-war returns after full allowance has been made for changes in yalue. British foreign trade in 1931 and 1932 (provisional figures) was as follows: 1931 1932 Imports #861,252,638 £703,132,725 Exports £390,621,598 £365 137,785 Re-exports£ 63,867,549£ 50,913 593 Exce of Imports over Exports Exce of Government receipts from Overseas Net National Shipping income oe Net Income from Overseas investments apparent difference in any case is due to the absence of certain items, generally called ‘invisible imports or ex< ports,’ from the returns of trade, im which account is only taken of material commodities. The invisible itemeg fall under twe headings, viz. services and payment of interest or capital. Among proceedy of services the most important are the earnings of shipping and of insurance and financial busine es, which are remitted to the country rendering them in bills, with the proceeds of which goods are bought, while in some instances the expenditure of foreign tourists is a large item. In the other case @ country investing capital abroad sends goods abroad against a promise to pay interest or dividends as these may accrue; the goods exported appear in the return, while the consideration for which they are sent is an ‘invisible import.’ Later, when @ country has invested large amount a of capital abroad, it receives interest on these sums in the form of goods. The United Kingdom has long had a large balance of imports over total exports, and the table below is a rough estimate of the way in which the balance is accounted for. It will be seen that the ‘invisible exports’ were in reality greater than the adverse balance of trade, leaving @ true balance of exports over import# Net receipts from short interest and commi ions Ac ae ory Net receipts from other sources Total Estimated Credit balance Se £33 Balance of Trade. A feature of foreign trade which has always commanded much attention is the relation between the quantities of imports and exports, the difference between these two being generally known as the Balance of Trade. For centuries it was held that a prosperous state should show a balance of exports over imports and such a balance received and has retained the name ‘a favourable trade balance.’ This view was the result of the mercantilist fallacy that the object of foreign trade was the importation of precious metals to swell the treasure within the country. It is now realized that money in all its forms is only the denominator in international trade, and that unle a country is piling up debts or credits abroad its imports and exports must balance, when all the items are taken into account. The oe 1950 lydl1 ae $336,000,000 | £411,000,006 19,000,000 16,000,000 ote 105,000,000 80,000,000 220,600,000 165,000,000 ae 55,000,000 30,000,000 Re 15,000,000 10,000,000 414,000,000 301,000 000 +28.000.008 |—776 000.005 which is accounted for by investments of British capital abroad, or by repay-< ments of debt owed by Great Britain abroad, during the year in question.