H.—44.

The outstanding increase in the value of our total exports during 1934 to all European countries was mainly due to the increase in wool prices, together with larger purchases by those countries of skins, apples, and peas. The foregoing figures are not truly indicative of our export trade to several of these countries — e.g., Germany, France, and Belgium—because a considerable amount of New Zealand produce is purchased via the United Kingdom, and is shown in our statistics as exports to that country. Direct exports to the eight European countries enumerated in the foregoing table consisted principally of the following products : —

Trade with the East. The Department has continued to give special attention to the question of the development of our export trade with the East. Until such time, however, as certain main obstacles to trade are removed development will probably continue to be slow. These obstacles are, firstly, the inadequacy of direct shipping facilities between New Zealand and certain Eastern countries, and, secondly, the comparatively high cost of freight between New Zealand and such countries resulting from the necessity for transhipment either at Sydney or at Honolulu or Vancouver, as the case may be. There are grounds for believing, however, that these difficulties may be overcome in the near future as a result of discussions in both Australia and New Zealand with representatives of shipping companies. Numerous inquiries for a variety of New Zealand products continue to be received from all parts of the East, and in all such cases the inquirers have been placed in direct touch with persons, firms, and organizations likely to be interested. It is known to the Department that in a number of instances the obstacles referred to in the preceding paragraph have prevented quotations competitive with Australia from being submitted, and, in consequence, the persons and firms approached by the Department were unsuccessful in securing the business. The following table shows the value of our export and import trade with various Eastern countries for each of the past three calendar years : —

The principal features, so far as our export trade is concerned, are the increases in 1934 in the value of sales to British Malaya, India, and Japan, and the decrease in value of sales to China. Of the increases, that in the case of Japan was by far the most important, and this occurred as a result of increased sales of wool, exports of which were valued at £689,851 in 1934, as compared with £233,229 in the preceding year. Reference should be made to the special inquiries that have been made by the Department during the past year in relation to markets for ghee in the East, and the possibilities of manufacturing that commodity in New Zealand for export. Arrangements were made with the Department of Scientific and Industrial Research and the Dairy Research Institute at Massey Agricultural College for samples of ghee to be prepared for the purpose of trying out various overseas markets. As a result, complete

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Value. Commodity. Value. £(N.Z.) £(N.Z.) Wool .. .. .. 2,755,352 Frozen and preserved fish .. 2,860 Sheep-skins .. .. .. 203,594 Seeds .. .. .. 3,513 Calf-skins .. .. .. 34,031 Peas .. .. .. 17,732 Cattle-skins .. . ; .. 95,495 Apples .. .. .. 113,352 Rabbit-skins .. .. .. 7,325 i Kauri-gum .. .. .. 10,510 Opossum-skins .. .. 1,000 Casein .. .. .. 2,518 Tallow .. .. .. 13,191 Sausage-casings .. .. 10,527

1932. 1933. 1934. Exports to — £ £ £ Dutch East Indies .. .. .. 5,255 5,496 2,548 British Malaya .. .. .. 26,868 22,929 49,727 Burma .. .. .. • • 827 743 208 Ceylon .. .. .. .. 3,498 2,670 393 Hong Kong .. .. .. .. 14,153 15,143 16,238 India .. .. .. .. 53,378 34,326 65,161 China .. .. 15,413 54,564 19,099 Japan .. .. .. .. 236,799 354,462 856,014 Philippine Islands .. .. .. 1,081 413 2,493 Imports from — Dutch East Indies .. .. .. 793,647 798,579 1,105,740 British Malaya .. .. •• 86,431 50,545 51,860 Burma 13,437 13,791 9,299 Ceylon .. .. .. .■ 351,598 442,628 468,548 Hong Kong .. .. .. .. 4,832 5,039 7,745 India .. .. •• • • 354,752 461,532 534,043 Japan 434,746 541,342 669,278 China 77,283 58,228 78,765 Philippine Islands . . . . .. 5,654 5,626 10,573