of all Philippine products shipped to the United States, as compared with 95.1 per cent in 1899-1902.

Prior to 1902 the greater part of the manila fiber shipped to the United States was generally handled through foreign (non-Filipino) middlemen at intermediate foreign ports, and Congress, through the act of March 8, 1902, sought to correct that anomalous situation respecting this important raw material for American industry produced in a possession of the United States.

An examination of the movement of manila fiber, before and after the exemption as well as after the removal in 1913 of the export duty, does not reveal American monopolization of the fiber.

Table 25 shows the export movement of manila fiber from 1899 to 1929. Table 3 indicates separately average prices of manila fiber shipped to the United States and to other destinations during the period when under the congressional act of March 8, 1902, this commodity was exempted from export duties if shipped to the United States.

Part II

COMPARATIVE TRADE AND TARIFF ADVANTAGES

PHILIPPINE-UNITED STATES COMMODITY TRADE BALANCES, TARIFF PREFERENCES, AND TARIFF LEVELS

Philippine Commodity Trade Balances with Continental United States and with Other Countries and Regions.

Commodity trade balances between the Philippines and the United States are best considered on the basis of Philippine commercial statistics, so that the difference in tendency of concurrent balances of the Philippines with countries other than the United States may also be shown.

During the whole 32-year period from January 1, 1899 (about four and one-half months after the American occupation of Manila) to December 31, 1930, the balance of commodity trade between the Philippines and continental United States was favorable to the islands by about $381,194,000. In other words, the total imports from the United States during that period were $1,170,397,000 and the total exports $1,551,591,000, the exports exceeding the imports by 32.6 per cent. During the same period the balance of commodity trade between the Philippines and all foreign (non-American) countries and regions together was unfavorable to the islands by about $126,706,000, imports of $1,083,099,000 exceeding exports of $956,393,000 by 13.2 per cent.

Supplies for use and consumption of the United States services in the Philippines, originating both in the United States and in other countries, are included in the trade figures for the Philippines beginning July 1, 1910, and can not be segregated. These purchases from the United States for the Army alone may be tentatively placed (based on estimates only) at not less than $50,000,000 and from other countries at not less than $10,000,000 during the 19%1⁄2 years from July 1, 1910, to December 31, 1930, and should be subtracted from. strictly Philippine imports, since they were paid for by American taxpayers and not by the Filipinos. With these deductions, the remaining balance favorable to the Philippines in their commodity trade with the United States may be placed at not less than $431,194,000, the exports exceeding commercial imports by 38.5 per cent; and the remaining balance unfavorable to the islands in their commodity trade with all foreign countries and regions together would be not more than $116,706,000, commercial imports exceeding exports by 12.2 per cent. These balances cover substantially the whole period of American occupation of the Philippines to the end of 1930.

1 Not including a nominally unfavorable balance of about $5,160,000 to the Philippines during 1899-1929, which was 72.7 per cent in excess of exports to the American possessions, Hawaii, Guam, and Porto Rico, the balance arising principally through Philippine importations of coffee and of sugar machinery from Hawaii.

Either with or without the exclusion of a part of the imports for the United States Government into the Philippines, estimated above on a conservative basis, the figures clearly indicate a continuing tendency of Philippine shipments to the United States to exceed very consider-. ably their imports from this country; while Philippine imports from foreign countries and regions show an almost constant tendency to exceed their exports to those destinations.

From the beginning of American occupation of the Philippines to the beginning of the reciprocal duty-free trade period in 1909 commodity trade balances in each year were favorable to the islands in their trade relations with continental United States, and continued so during the first year of mutual duty-free trade. From July 1, 1910, to the first full year of the World War, 1915, Philippine commodity trade balances with the United States fluctuated from year to year, but on an average were unfavorable to the islands. However, importations for the United States Government during this period (which are included in the only available Philippine import figures) were no doubt sufficiently large to offset the average nominal unfavorable balance just mentioned.

Beginning with the second full year of the World War, 1916, Philippine commodity trade balances with the United States have been favorable to the islands in every year except 1919 and 1921, and generally increasingly so beginning with 1923, which was the first full year following the United States tariff act of 1922. During the six years 1923-1928, under the tariff act of 1922 (which increased the measure of American tariff preference to leading Philippine export products), the average annual commodity balance in favor of the islands in their trade with the United States was about $36,012,000, the annual average exports of $103,839,000 exceeding imports of $67,827,000 by 53.1 per cent. During 1929 the favorable balance to the islands in this trade was $31,872,000, and in 1930 it was $27,159,000. With the elimination of imports for the United States services into the Philippines, the average annual commodity trade balance in favor of the islands during 1923-1930 in their trade with the United States was not less than $36,000,000.

2

Over the whole period, January 1, 1899-December 31, 1930, the proportion of total Philippine imports taken from continental United States was 52 per cent, as compared with 62 per cent of total Philippine exports shipped to the United States. It was only during the fiscal year 1913, the six months ending December 31, 1913, and during the calendar years 1915, 1919, and 1921, that the proportion of Philippine total imports coming from the United States exceeded the proportion of Philippine total exports going to the United States.

Table 4 shows the annual, the average annual and total commodity trade and trade balances, and also the proportions of Philippine import and export trade with continental United States and with all other countries and regions, practically from the beginning of American occupation of the islands to the end of 1930.

2 After the remission by Congress in 1902 of Philippine export duties on Philippine products shipped to the United States if such products were on the general free list of the United States tariff, direct shipments of manila fiber to the United States increased greatly and, until the beginning of reciprocal duty-free trade in 1909, were generally reflected in much larger proportions of Philippine total exports going to, than of total imports coming from the United States.

Comparative Amounts and Proportions of Philippine-United States Trade Reciprocally Favored Through Duty-Free Trade Relations.

It is recognized that it would be difficult and impracticable to measure the full scope of comparative United States-Philippine tariff benefits by mathematical standards; even a partial measurement is difficult because practically there are no tariff barriers between them.3 Nevertheless, certain definite trends may be ascertained by finding the amount of trade exempted from duty on each side, and establishing the periods when duty-exempt trade values were greater on one side than on the other.

From the beginning of duty-free trade between the Philippines and the United States in 1909 until the end of 1929, imports into the United States from the Philippines, valued at about $797,341,000, were given tariff preferences, the remaining $560,592,000 being on the general free lists of the United States tariffs regardless of origin.

During the same 20-year period imports into the Philippines from the United States and its possessions, valued at about $1,044,059,000, were given Philippine tariff preferences. But this amount included large importations into the Philippines, from July 1, 1910, to the end of 1929, for or for account of the United States Government, of which the exact amount can not be ascertained but which are estimated at not less than $50,000,000 for the Army alone. If this estimated amount of United States Government purchases is eliminated from the Philippine figures, it appears that from the beginning of mutual free trade to the end of 1929 the value of American goods receiving tariff preferences in the Philippines exceeded by not over $196,718,000, the value of Philippine products receiving tariff preferences in the United States under the reciprocal duty-free trade status.

In every year from the beginning of reciprocal duty-free trade relations in 1909 to and including 1921, Philippine importations of tariff-favored goods from the United States and its possessions exceeded by considerable margins the values of similarly favored Philippine products imported into the United States. While this tendency continued in 1922, the margin in favor of American trade exempt from duty in the islands was reduced to a relatively small figure in that year, if importations into the Philippines for account of the United States Government services are deducted. But beginning with 1923 (the first year following enactment of the United States tariff act of 1922) to and including 1929, American importations of tariff-favored Philippine products have exceeded Philippine importations of tarifffavored American products in each year except one; this was in 1926, when imports from the Philippines into the United States were larger by about $1,453,000, which no doubt was more than offset by shipments received in the Philippines for account of the United States Government during that year. The annual average amount of American importations of tariff-favored Philippine products during the 5-year period 1924-1928 exceeded by about $6,323,000 the annual average value of shipments of tariff-favored American products into the Philippines during that period, and in 1929 the excess was $5,333,000. These amounts would be increased considerably if

Except the 20 per cent limitation on the value of permissible foreign material content in Philippine products admissible duty free into the United States.

The corresponding statistics for the Philippines for 1930 are not available as this is written, but it is evident from preliminary figures that the tendency described continued during that year.