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buildings and equipment. In association with the New Zealand Dairy Board, the Commission has been engaged in investigating, and, where possible, arranging for amalgamation of dairy-factory companies and the rationalization of cream and milk collection, with a view to saving costs and improving quality. Discussions have been initiated in regard to local marketing of dairy-produce, as well as the revision of the overseas marketing regulations. The reorganization of the group herd-testing movement and the initiation of a system of universal farm-dairy instruction, as well as the development of the export trade in baconer pigs, and problems relative to breeding, feeding, grading, trim, and methods of handling, are receiving attention. Efforts are being made by the Commission to place the marketing of honey abroad on a sound basis, while the question of effecting a better co-ordination between local and export marketing of fruit is the subject of discussion with the New Zealand Fruit-export Control Board and the New Zealand Fruitgrowers' Federation. Proposals for the development of the citrus-growing industry and institution of a system of grading to assist the marketing of New Zealand lemons are also under consideration. The whole question of additional markets is under review, and a number of preliminary inquiries have already been made as to the possibilities of other overseas markets for New Zealand primary products. At the present time the possibilities of extending trade to Eastern markets are limited by the lack of direct shipping facilities and other difficulties, but inquiries have been set on foot by the Department of Industries and Commerce with a view to improving the position. Finally, it may be mentioned that the Commission, with the Departments of Agriculture, Industries and Commerce, Scientific and Industrial Research, and the Unemployment Board, is taking part in the investigation of the possibilities of a wider and more varied utilization of flax. Efforts are also being made to bring about a closer relationship between scientific research and agriculture. : I may mention here that local manufacturers generally are taking action in the direction of co-ordinating their efforts towards increasing efficiency and generally paving the way for an expansion of their activities. Certain proposals designed to improve their organization for these purposes have recently been submitted to the Government, and, if it is found practicable to give effect to them, the result should be a further stimulus to our manufacturing industries. During my recent visit to England I took the opportunity of discussing with the Society of Motor Manufacturers and Traders the question of assembling motor-vehicles in New Zealand. As a result of these discussions British manufacturers have agreed to export their vehicles to the Dominion in a " completely knocked down" condition. The assembly of these vehicles in New Zealand will give employment to a large number of people. Furthermore, the Government is assured of the co-operation of the manufacturers in the utilization of as much New Zealand material as is economically possible. In trade and commerce generally there is ample evidence that the position is steadily improving. For the year ended 30th June last imports increased by £7,600,000 over the previous year, and are now more in keeping with the value of exports, having regard to the amount of debt charges payable overseas. The latest complete figures available for factory production in New Zealand, 1933-34, show an increase of £5,660,000, or 8-6 per cent., over the previous year. From a wide and representative sample taken from the incomplete returns for 1934-35 it would appear that factory production for last year showed a further increase of from 10 to 15 per cent. In consequence, it is estimated that the number of factory employees increased by 9,000 during the past twelve months. An improvement in the turnover of business is also indicated by the following increases for last financial year in comparison with the previous year: — Per Cent. Bank debits .. .. .. .. ..10-8 Sales tax .. .. .. .. 17 "5 Railway revenue .. .. .. .. . . 6-4 Post Office revenue .. .. .. .. .. 4.5 Land transfers registered .. .. .. .. 27 • 7 Motor-vehicles licensed .. .. .. .. 6-2

New overseas markets.

Co-operation among manufacturers.

Assembly of British vehicles in New Zealand.

Improving economic conditions.

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