on dura and maize, 1 Maria Theresa thaler per gisla 55 was equal 20 or 25 per cent ad valorem, and the rates of 14 to 74 Maria Theresa thalers each on animals were equivalent to rates of 12 to 33 per ce ad valorem, if the official valuations show the market prices whi the rates of 20 and 25 Maria Theresa thalers on horses and mul were 40 and 60 per cent, respectively, of their valuations. The Comandante's report 57 complains that the heaviness of the exper duties restricted the trade, and he particularly mentions those cereals, animals, myrrh, and gum (which is of poor quality and e which 6 per cent is almost prohibitive). Most of them were later greatly reduced.

PRESENT TARIFF RATES.

The present tariff of Somalia appears in five schedules, there being different schedules for imports from foreign countries, from Italy, and from Eritrea; and separate schedules for exports to Italy and to foreign countries. With few modifications, the rates are those of the royal decree of August 12, 1911, which came into force on January 1912.58 They are given in extenso on pages 406-7 below, rearrange! into a single table of import duties and one of export duties in orde to exhibit the differential rates.

It will be observed that the rates on tobaccos 50 and on goods n enumerated exceed the 10 per cent allowed by the additional act the Brussels conference of 1890 for the Congo free trade zone.

Increase of differential rates in 1911.-The differentials in favor d Italian goods are greatest on the articles not enumerated and parti ularly on those not listed in either schedule. In fact more than one half the items in the schedule for imports from Italy have rates th same as those on similar foreign articles. The preferences are fe the most part unenumerated and to that extent concealed.

It will be observed also by comparing the rates with those prev ously in force that every increase over the rates of 1905-on wine, c machines and parts thereof, on cotton yarn and all cotton textile not mercerized, and on all articles not enumerated-falls only on th foreign product, i. e., is used only to increase the differential. Fur thermore, every preference (with the single exception of the surtar on spirits, found not in the tariff schedules but in the preliminary provisions) previously granted was increased at this time. Thus cottons of all kinds (except those mixed with silk) the differential w changed from 5 per cent on Italian, compared with 7 per cent foreign goods, to 3 per cent on Italian against 10 per cent on foreg goods. The rate on Italian wines remained unchanged, but that a foreign wines was made three times instead of twice as great; linen made up, and on flour, corn, and wheat the rate on Italian products was reduced from 5 per cent to 1 per cent, the rate on the foreign article remained at 10 per cent. The following articles on

56 The gisla is equivalent to approximately 33 hundredweight.

56 As the duties are specific and the valuations are merely for statistical purposes, there is no reason suppose that they greatly misrepresent the low values on this isolated coast. Cf. the market quotat co published in later years in the Bollettino di Informazioni of the Colonial Ministry; e. g., Vol. IV, No. 1 according to which camels were selling in July, 1916, in the lower part of the Webi Scebeli at prices from to 70 rupees, and oxen from 12 to 40 rupees.

57 Ministero degli Affari Esteri, Benadir, p. 116. And see the official valuations in Som. Man., Vol. pp. 326-337. The tariff of 1907 increased the duty on Benadir beans from 1 per cent to 1 Maria Theres thaler per gisla, equivalent to 15 per cent according to the official valuation. Bol. di legis., Vol. 25, p.21. 68 Som. Man., Vol. III, p. 486.

69 The duties actually collected in 1914 were on leaf tobacco 15.5 per cent and on manufactured tobac 41.2 per cent of the value imported.

405

hich the preference was formerly not more than one-half of the rate n foreign goods were transferred to the list of articles not enumerated, here the duty is 1 per cent as compared with 15 per cent paid by imilar foreign goods: Beads, matches, alimentary products, knit goods, silks, and cottons mixed with silk; and other goods on which here had been no preference were by the same transfer given the maximum differential: Tea, dry fish, mercery, spices, earthen and glass ware, mineral oil, and refined sugar. Other articles which have never been enumerated, but which are of some importance in the trade, are enameled ironware, Marzocchi lamps, candles, and two kinds of cloth called bit and abdallacan.60

Differentials in export duties.-In the export duties two points are striking—the reduction of most of the list to 1 per cent, and the according of a 5 per cent preference to Italy in the exportation of hides and skins. This is important, not because of any success that it has had in diverting the trade, but as showing the relative magnitude of the trade on which the Italians granted themselves this preference. Differentials on four items in the whole list do not look impressive, and three of these have no great importance, but hides and skins usually constitute about two-thirds of the total export. The export duty on hides and skins yields a considerable revenue and fear of the loss of this revenue prevented a greater reduction on exports to Italy. The striking increase in the export duty on oxen, in 1914, made that preference to Italy much the greatest in percentage of all the differentials. It would seem that the increases on goats, ewes, and cows must have been intended as a prohibition, a conclusion strengthened by the appearance in 1913 of a direct prohibition on the exportation of camels. The rates on dura and maize, which the Comandante termed excessive in 1907, were left unchanged.

Preference to products of Eritrea.-By the tariff of 1905, wheat from Eritrea was entitled to the same rate as wheat from Italy, namely, 5 per cent, as against 10 per cent levied on wheat of other origins. In 1911, Eritrean wheat, flour, corn, and salt shared the Italian preferential rate which was then made 1 per cent (except salt, 5 per cent) as against 10 per cent on the foreign product. In addition, coffee from Eritrea was given the special rate of 8 per cent, as against F10 per cent on foreign coffees, though that from Italy pays only 1 per

cent.

No preference in Italy to products of Somalia.-No preference is given in Italy to products of Somalia. The only exception has been that a decree of February 11, 1917, exempted from import duty in Italy, for the duration of the war, hides and skins which had been tanned without the hair in the Italian colonies.

Italian imports from Somalia have not received the exemptions from the Italian duties made to certain products of Eritrea in 1904. If exemptions were granted on the same articles (the grant which the Government is empowered to make), the exporters of cotton and gums alone would in all probability benefit. The total exportation of cotton for the three years 1910-1913 was 174,000 lire, of which 10,000

These are mentioned in Monografie, 1914, No. 14, p. 395, Italy being given as a source only in the case of the candles. The trade in these miscellaneous articles, i. e., those not enumerated on either list, is two to three hundred thousand lire annually.

02

See p. 411.

Martino, Tre Anni del mio Governo, p. 101, 139, 141. The fraction was three-fourths in 1911-12 and 1912-13. In 1917, in spite of the large increase in this item, the fraction decreased to less than one-half.

i

EFFECTS OF THE DIFFERENTIALS ON ITALIAN TRADE WITH SOMALIA.

The tariff differentials granted in the period 1905-1909 had lit effect in building up Italian trade with Somalia. No figures available to show the amount of Italian trade before 1905, but figures for 1910-11 show that at the end of the period in wh these differentials were in force the imports from Italy amounte to only 4.3 per cent of the total. In 1905-65 the importati from Italy was only 8,800 Maria Theresa thalers out of a total 1,201,000 thalers. Wine and alimentary products were the chi items, and of these the Italians_furnished the greater part. T figures for 1910-11 show that the Italian wines had displaced the for eign, that Italy supplied the mineral waters (on which the duty was not differential) and that in cotton goods and in goods not separately enumerated Italian trade had made a beginning as follows:

The item of mineral waters suggests that the differential duties ma have been minor factors in the trade situation. The "laudable in tiative of merchants" and the exhortations of the governor and othe

64 The following table shows the changes made in the differential duties of Somalia (the smaller ra each case is that on Italian goods, the larger that on foreign), those now in force appearing in the last colum

a Valuation of Italian goods reduced one-seventh. b Goods not enumerated included in 1905 enameled iron, candles, lamps, certain sugars, etc., and in 19 there was added to the previous list earthen and glassware, tea, mercery, dry fish, spices, and mineral (formerly dutiable without discrimination at rates not exceeding 10%), and those enumerated in the column above with the differential of 1%-15%.

The

65 The differentials of the tariff of September 12, 1905, were in operation through this whole year. fiscal year begins July 1, but at that time the monsoons prevent trading on the Somali coast and trade is resumed in September.

mitate the American packing and patterns may easily have been greater importance. That the Italians were not satisfied with results is obvious from the increases made in every preference in 11 and from the extension of the list to include over twice as many icles as before.

Differentials of 1911.-The preferences granted in 1911 scored one ry striking success-so striking that it may be seen even in the ures for the total imports of Somalia for the years 1908-1914, and : the Italian share of those imports.

The great increase of Italian trade in the period 1912-1914 is ccounted for almost entirely by the enormous jump in the exportaion of cottons. The cottons called Bofta all came from foreign countries after 1911 as before, but cottons other than the Bofta variety now come from Italy in increased quantities, as the following table shows:

Values of certain cottons imported into Somalia.

The preferences having been granted in the middle of this year, the figures are omitted.

438, 558 518,256

Comparing the figures in the above tables, it will be seen that almost exactly 90 per cent of the increase in Somalian imports from Italy represented increased imports of cottons. One-half of the remaining 10 per cent was in foodstuffs, where the preference seems to have induced an increase of imports from Italy without decreasing those from foreign countries. This is shown in the following table:

See both reports of Governor Cerrina, cited on pp. 403 and 422; also, though of later date, the Monografie already cited, e. g., No. 14, 1914, p. 391, and Tittoni, op. cit., p. 291.

Examination of the various other imports on which the Italian product received a preference shows that the Italian trade increased in one or both of the fiscal years 1912-1914, in beer, manufactured iron, earthen and glassware, yarns, and soap; but the amounts in volved were small, and the foreign trade in most of these cases increased absolutely to a much greater extent than the Italian. It is unsafe to conclude more than that the preference assisted the Italians to start a trade in these articles. The imports of wines and of mineral waters from Italy increased considerably after 1911, but the Italians already had almost a monopoly of the market, and the increased preferences of 1911 did not prevent the entry of smal quantities of foreign products. In articles not enumerated 7 the 67 Italian trade of 1912-13 was of smaller value than that of 1909-10. and was a smaller fraction of the total than in 1910-11.

68

The figures show that Somalia has never imported in quantities of any consequence knit goods, linen made up, cotton mixed with silk, or mercerized cotton. All the other commodities mentioned in the list of preferences continue to be imported exclusively or almos: exclusively from foreign sources. The figures show nothing conclusive concerning machinery; but it may be observed that Governor de Martino justified the duty of 5 per cent on ironware and machinery on the ground that such quantities as were required for the various industrial or landed concessions were admitted, and would continue to be admitted free so that the rate of duty was unimportant. He defended the retention of the duty of 3 per cent on Italian cottons by pointing out that a complete conquest of the market by free Italian cottons would cost the colony onefourth of its customs revenue. (This would be about one-sixth of the colonial income from all sources other than the State subsidy) To conclude, it can not be affirmed with certainty that the sma preferences of the earlier years were responsible for particular de velopments in trade which took place after their imposition. The much larger preferences of 1911 had one striking consequence, & great gain to Italian trade in cotton goods. This was at the expense of American trade, for the success of the Italian in supplanting the foreign was confined to those varieties of cottons which came almost exclusively from the United States. The preference on cottons is among the smallest on the list and other factors than the tariff may have had an influence in the change; yet since nearly one-half of the total importation of cottons was in the hands of one Italian firm, as was pointed out by Comandante Cerrina in 1907, if this firm

67 This refers to articles not enumerated in the trade returns, i. e., those articles not enumerated in the tariff as it stood before the changes of 1911.

68 See Som. Man., Vol. III, pp. 45, 105, for the decrees defining the terms of agricultural concessions, and Ib., Vol. II, p. 547; Vol. III, pp. 50, 52, 97, 99, 100, 105, 108, 133, 171, 187, 277, etc., for specific concessions. These concessions generally grant exemption from import duties but in no case discriminate between Italian and foreign goods. See also Martino, Tre Anni del mio Governo, p. 100.