TABLE 37.-Trade of Germany with SYRIA AND THE LEBANON, 1929-38 [Value in millions of reichsmarks]

1 Monatliche Nachweise über den auswärtigen Handel Deutschlands, Ergänzungsheft I, 1933 and 1938. The data are exclusive of trade in gold and silver bullion and specie, except that for the years 1937 and 1938, trade in silver is included. Figures for imports are reported as imports for consumption from “country of origin," and those for exports are reported as German products to "country of final destination.” Up to 1932, the exports as shown include deliveries in kind on account of reparations; thereafter, no such deliveries or other payments were made on account of reparations. In the German trade returns, the reichsmark figures for imports are c. i. f. values at point of entry, and those for exports are f. o. b. values at point of shipment. Syria and the Lebanon were not shown separately prior to 1934, but were included with "Other Asia."

2 Bulletin Economique, 4th quarter. The data are inclusive of trade in gold and silver bullion and specie. Figures for imports are reported as imports for consumption from "country of origin," and those for exports are reported as Syrian-Lebanese products to "country of destination." In the Syrian-Lebanese trade returns, the Syrian-Lebanese pound figures for imports are c. i. f. values at point of entry, and those for exports are f. o. b. values at Syrian port or frontier.

The rates of exchange shown were used for converting into reichsmarks the Syrian-Lebanese pound values as given in the Syrian-Lebanese trade returns. For the years 1929-37 the rates of exchange given are derived from the annual average of the French franc (1 franc=0.05 Syrian-Lebanese pound) as reported in Statistisches Jahrbuch für das Deutsche Reich, 1932 and 1938; the 1938 rate is the annual average rate derived from the annual average of the French franc as reported in Vierteljahrshefte zur Statistik_des Deutschen Reichs, 48. Jahrgang, 1939, Erstes Heft.

4 Less than 0.05 percent.

Effective Mar. 1, 1935, the Saar Territory became a part of Germany proper. However, the German foreign-trade statistics, beginning Feb. 18, 1935, cover the foreign trade of the German Reich thus expanded. Data for trade of Syria and the Lebanon with Germany (Old Reich exclusive of Austria) for the entire year 1938 are not available.

Not available.

SPECIAL EXCHANGE AGREEMENTS WITH THE UNION OF SOUTH AFRICA AND MANCHURIA

In their main characteristics, the special exchange agreements that Germany entered into with the Union of South Africa and with Manchuria did not conform with the typical payment agreements discussed in the preceding pages. The agreements with these two countries included features which resembled more the aski and exchange-clearing procedures.

Under the agreement with the Union of South Africa, payments by German importers were to be effected through special accounts of the three principal South African banks with the Reichsbank. This procedure differed from the aski system mainly in that conversion of

these accounts was effected directly by the Reichsbank from the proceeds of German exports to the Union of South Africa.

The agreement with Manchuria provided that a certain portion of the proceeds from Manchurian exports to Germany be credited to a special account that could be used only to purchase German goods. This arrangement did not essentially differ from those established under exchange-clearing agreements.

AGREEMENTS WITH THE UNION OF SOUTH AFRICA

In 1934 Germany and the Union of South Africa entered into a special exchange accord the terms of which were never published. It was renewed each year thereafter, with amendments which apparently altered only the quotas of particular South African products to be imported into Germany. The accord with South Africa was first designated as a payments agreement in German official publications in 1937.38 In August 1939 the text of an agreement to run from September 1 of that year to August 31, 1940, was published by the Government of the Union of South Africa as the "Sixth Payments Agreement Between the Union of South Africa and the German Reich." This designation, as well as unofficial information, indicates that the exchange arrangements established by the earlier and unpublished agreements were similar to those described in the 1939

text.

39

The 1939 agreement provided that the Standard Bank of South Africa, Ltd., the Netherlands Bank of South Africa, and Barclay's Bank were to maintain special accounts (Sonderkonten) with their branches in Germany or with German banks, and that German importers were to pay for their purchases of South African goods by deposits of reichsmarks to these special accounts. The German Government agreed that the Reichsbank would turn over the foreign exchange (South African pounds sterling, or other free currency) derived from sales of German goods in South Africa to the branches of the South African banks against payment of the reichsmark equivlent at the official rate of exchange. Private-compensation transactions were forbidden during the life of the agreement.

The agreement contained a schedule of South African goods which Germany agreed to purchase during the year, through the procedure above described, to the values stated. Wool was the most important of these commodities. Germany agreed to import in the year beginning September 1, 1939, wool to a value of at least 3,700,000 South African pounds. This, with other similar commitments, provided "Übersicht über den Stand der wirtschaftspolitischen Beziehungen Deutschlands im Jahre 1937, p. xii. "Government Gazette, August 25, 1939, p. 835.

for minimum total imports of 6,355,000 pounds worth of South African goods.40

The agreement also provided that Germany should make available free exchange to pay for imports of any South African goods of a kind not listed in the schedule, as well as for imports of any listed commodity in excess of the values specified, without regard to whether German exports to South Africa were sufficient to provide this exchange. This commitment was qualified, however, by a provision that "this undertaking does not preclude negotiations between the two governments for the accommodation of such excess shipments within the current or following agreement."

The outbreak of the present war prevented the 1939-40 agreement between the Union of South Africa and Germany from having any significance for the trade between the two countries.

GERMAN-SOUTH AFRICAN EXPERIENCE UNDER SPECIAL EXCHANGE

AGREEMENTS

41

Statistics of the trade between Germany and the Union of South Africa in the years 1929 to 1938 appear in table 38 according to the trade returns of both countries. Table 39 shows the principal commodities imported by Germany from the Union of South Africa in specified years, 1929 to 1938, and the position of the Union of South Africa as a supplier of these goods to Germany.

40 Similar schedules for the earlier years were published by the Government of South Africa. The sched ules for each successive year except the last showed increases over the preceding year. The initial agree ment of December 1934 provided only for purchases by Germany of wool during the following season in the amount of £SA2,400,000. This agreement was later supplemented by the inclusion of other items valued at £SA460,000. The second agreement, concluded in November 1935, enlarged the total amount of South African goods which Germany agreed to purchase to £SA2,990,000. The total of the third agreement was ESA4,000,000. The fourth agreement initially provided for the purchase of South African products to a value of £SA4,630,000, but was later supplemented by an amount of £SA1,056,500. The fifth agreement called for purchases in South Africa to a value of £SA6,355,000, to which was later added £SA355,000. The schedule for 1939-40 was as follows:

TABLE 38.-Trade of Germany with the UNION OF SOUTH AFRICA, 1929-38

Monatliche Nachweise über den auswärtigen Handel Deutschlands, Ergänzungsheft I, 1933 and 1938. The data are exclusive of trade in gold and silver bullion and specie, except that for the years 1937 and 1938, trade in silver is included. Figures for imports are reported as imports for consumption from "country of origin," and those for exports are reported as German products to "country of final destination." In the German trade returns, the reichsmark figures for imports are c. i. f. values at point of entry, and those for exports are f. o. b. values at point of shipment. Includes trade of Northern and Southern Rhodesia and Nyasaland for the years 1929-35; data for Union of South Africa are not shown separately prior to 1936. 2 Annual Statement of the Trade and Shipping of the Union of South Africa. The data are exclusive of specie, but include bullion. Figures for imports are reported as general imports from "country of origin"; and those for exports are reported as South African products to "country of destination." Beginning in 1933, the total exports include the amounts of premium realized on gold bullion exports. The premium amounted to over 22 percent in 1933 of the total exports and to over 28 percent in 1935. The amount of the Fremium is not shown separately after 1935. In 1938, gold bullion earmarked for banks amounted to over 21 percent of total exports. Gold bullion for bank purposes is included in earlier years, but not shown separately. In the South African trade returns, the South African pound figures for imports are costs to the importers, f. o. b. point of shipment. The figures for exports are f. o. b. values at South African port or frontier.

The rates of exchange shown were used in converting into reichsmarks the South African pound values as given in the South African trade returns. For the years 1932-37, the rates of exchange given are the annual average value of the South African pound as reported in Statistisches Jahrbuch für das Deutsche Reich, 1932 and 1938; the rates of the South African pound for the years 1929-31, inclusive, are not shown in the above-mentioned source. For those years the rates of exchange for the South African pound were computed from the reichsmark rates for the British pound sterling by multiplying such reichsmark rates by the ratio of the annual average rate of the South African pound to the British pound sterling as given in the Statistical Abstract for the British Empire, 1926-35, p. 187. The 1938 rate is the annual average rate as reported in Vierteljahrshefte zur Statistik des Deutschen Reichs, 48. Jahrgang, 1939, Erstes Heft.

Effective Mar. 1, 1935, the Saar Territory became a part of Germany proper. However, the German foreign-trade statistics, beginning Feb. 18, 1935, cover the foreign trade of the German Reich thus expanded. Data for trade of the Union of South Africa with Germany (Old Reich exclusive of Austria) for the entire year 1938 are not available.

TABLE 39.-Principal imports into Germany from the UNION OF SOUTH AFRICA and share of these commodities supplied by the UNION OF SOUTH AFRICA, in specified years, 1929 to 1938

Source: Monatliche Nachweise über den auswärtigen Handel Deutschlands.

As already stated, the special reichsmark accounts of the branches of the South African banks in Germany were, in some respects, similar to the aski accounts through which payments were made for all or part of the German trade with several Latin American countries. The arrangement however, differed from the aski system in that South African importers of German goods remitted their payments in freecurrency drafts. Moreover, the prices paid by foreign importers for aski marks were usually below the official foreign-exchange value of the reichsmark, whereas the South African agreement provided that the reichsmarks in the special accounts of the South African banks would be redeemed by the Reichsbank, at the official rate of exchange, out of the free exchange derived from German exports to the Union of South Africa. This provision prevented any considerable departure of the nominal value of the reichsmarks in these special accounts from the official exchange value of the reichsmark. It did not, however, preclude the accumulation of balances in these special accounts if the free exchange from sales of German goods in South Africa should prove insufficient to convert the reichsmark deposits of German