Mr. Speaker, I should like, with leave, to make a statement in regard to the negotiations which have taken place between the South African Government and the United Kingdom Government, which read as follows—

Mr. Speaker, I have given a brief picture of the Government’s intentions in regard to certain matters which are of immediate importance to the House and to the public. More detailed information will be made available during the debate on the Bill which will be introduced later this Session.

I move—

I second.

Agreed to.

Bill read a third time.

I move—

I second.

Agreed to.

Bill read a third time.

I move—

Mr. Speaker, this Bill amends various Railway Acts. The matters dealt with are not contentious and should receive the support of the House. I have tabled a very comprehensive memorandum which not only explains the different clauses but which also give the reasons for the introduction of this Bill, and I trust that hon. members have studied the memorandum. I will consequently make my remarks very short.

Clause 1 is designed to facilitate administrative work. Clauses 2 and 3 benefit certain servants who will receive gratuities or annuities upon retirement. Clause 4 deals with a line of railway to which Parliament agreed in 1956; it is a line of railway between Avoiding Line Junction, Cape Town, and Nyanga. This railway line will still be provided but a portion between the avoiding line junction, Cape Town, and Woltemade will be integrated with existing lines of railways, and the construction may take place without the authority and a special Act of Parliament.

Clause 5 deals with definitions. Clause 6 (a) is consequential. Paragraph (b) has been inserted because the original provision served no practical purpose. Clause 7 is designed to protect the Administration’s interest and to remedy certain weaknesses in the present provisions. Clause 8 empowers the Administration to supply Bantu servants with intoxicating liquor while a resident in hostels and compounds. Clause 9 protects the Administration as well as the public. Clause 10 is to bring the Act into line with South Africa’s new status while protecting Commonwealth and Republic of Ireland citizens who are already in the service.

Clause 11 deals with leave standing to the credit of certain female servants at the date of retirement. This provision is to the advantage of those female servants. Clause 12 merely provides that the Act shall apply to the territory of South West Africa and Clause 13 is the short title of the Act. Those are the provisions of the Bill; they are not contentious and I hope that they will receive the support of the House.

When, in the House of Lords on 8 May, the Parliamentary Secretary to the Ministry of Transport moved the second reading of a Transport Bill, he said this—

That “little piece of excitement” in the House of Lords, to which the Parliamentary Secretary to the Ministry of Transport referred, was the South Africa Bill which was being introduced there. It is rather a strange coincidence that, in this Bill which the Minister of Transport has put before us now, we find the first attempt by our Government to regularize, on a reciprocal basis, the special facilities being given to newly made “foreigners” who had once been privileged Commonwealth and British citizens in South Africa. In the Republic they now become foreigners under Clause 10 of this Bill. It is rather strange that, in our House also, the Bill to allow them to retain, until 1966, the privileges of South African citizens should have followed the statement just made by the Minister of External Affairs—also a “little piece of excitement” of a similar nature. May I say, before I examine the other clauses of this Railway and Harbours Acts Amendment Bill that, although it is no fault of the Minister’s, who does seek to extend to certain foreign Railway servants, in legislative form, the reciprocal arrangements which have been arrived at by negotiation between the two Governments, this is rather an unsatisfactory method of dealing with this problem. I feel that the more correct procedure would have been to wait until the situation in all its various facets could have been dealt with in one Bill and not sprung upon us by ministerial statement and in a piecemeal and sectionalized form as in this Railway Bill. I know that the Minister is not to blame for this. This Bill is at least regularizing for three and a half years the position of Railway servants and bringing their status up to date with British legislation. But I do feel that we should register a protest at this slip-shod method of dealing with the important reciprocal nationality and citizenship arrangements. I note another thing, Sir. Apparently only to-day did the South Africa Bill, in its final form, pass through the British Houses of Parliament. Only this morning did we learn the exact time limit to citizenship privileges to be enjoyed by South Africans who are in the service of the British Government and semi-Government service. It is only really to-day that we knew finally that the terminal date for mutual concessions would not be extended to the end of 1966 instead of 1965. This Bill was printed some days ago and I wonder how the Minister knew that the British Bill was not going to extend the period by one more year. There were extensive debates in the Commons and the Lords asking for an extension to the end of 1966. The Minister must have possessed some prescient faculty to know in exactly what form the British Bill would actually be passed. If an amendment had been accepted in the House of Lords the “reciprocal” arrangements which he makes in this Bill would not have coincided with those of Britain. …

Intelligent anticipation.

I think it was a shot in the dark. May I say that I am sorry that the extra year of grace was not granted in England. If it had I would have moved that it be granted here too.

Let me take this Bill clause by clause. As the Minister says, because of this very full explanatory memorandum, it will not be necessary to deal with each clause in detail. May I say that this explanatory memorandum is better than any of those previously issued. It explains amendments meticulously. Members are left knowledgeably informed about the meaning of every single amendment. Clause 1 deals with a delegation of financial authority. I have always been one who has objected to any form of delegation, if there is no sufficient parliamentary safeguard. In this case, however, I believe the clause to contain a justified delegation of financial authority by the Minister to the General Manager. All the necessary financial checks and balances which Parliament needs are present. It seems to me a very necessary administrative change in keeping with the changing condition of our economy. As we all know, and as the explanatory memorandum says, the increased cost of materials and the decreasing value of money make it realistic that the expenditure which can be authorized by the General Manager, without reference to the Minister, for new works or improvements, should be doubled. It will in future be R10,000 instead of the unrealistic figure, fixed as far back as 1918, of R5,000 (or then £2,500). I concur also in the case of excesses of more than 10 per cent on approved amounts, that the Minister’s authority need not be sought unless the additional amount required for a particular work exceeds R20,000. That is a necessary change and will assist the Administration.

Clause 2 merely regularizes pension matters in relation to casual labourers and those who are getting gratuities. As far as Clause 4 is concerned, we have no quarrel with the amendment. We know the complexities that arise when new lines of “guaranteed” railway have to pass over the ordinary regular service lines for part of their distance. In this case the building of the line to Nyanga was a complicated performance, and I guess that is one of the reasons why the Minister took such a long time to arrive at a correct formula as to what the Treasury should pay to the Transport Department for this guaranteed line to the Native location.

Clause 5 relates to definitions, and we have no comment to make on it. Clause 6 of the Bill is also a necessary clause. I believe it has been the common practice for every master of every ship on entering Table Bay to be handed a copy of the Railways and Harbours Control and Management Consolidation Act of 1957, which, I am sure, they could not understand. Even if they did understand it they would not have the time to read it. They have agents here who are perfectly well aware of the regulations. The distribution of copies of this Act is wasteful, and I am glad it is going to be done away with now. Clause 7 of the Bill also seems to be necessary. It will ensure that in fact proper rates are charged for the appropriate commodities consigned to the railways and that no wrong advantage is taken of an intimate knowledge of the rating system to avoid the consequences of what is described as a “misdescription of the nature of the goods”.

Clause 8 of the Bill merely relates to “kaffir” beer, Bantu beer, or whatever the hon. member for King William’s Town (Mr. Warren) cares to call it. It merely gives the Railways the same rights and privileges which, I believe, the mines and the municipalities have. The beer will be bought, I take it, from the municipality if that local authority can supply it; otherwise the Railways take the right to brew the beer themselves. The net profits derived from the sale of liquor to Bantu servants goes into a fund for the benefit of the Bantu employees. Clause 9 of the Bill deals with claims. I think it is necessary that no evasion of responsibility in connection with the lodgment of claims should be possible. It makes the lodgment of a late claim dependent upon the court being satisfied both (a) that the claimant has not been dilatory and (b) that the Railway Administration will not be prejudiced. Clause 10 deals with the situation regarding reciprocal legislation passed by the British Parliament. I need say no more than I have said in my opening remarks in that regard. As far as Clause 11 is concerned, we agree to it, of course, because it does regularize the position and prevents inequalities taking place in relation to the pensions of female employees of the Railways. I am sure that this side of the House, although some other hon. members may have something to say, will agree to the second reading of this Bill.

Clauses 2 and 3 of this Bill deal with certain superannuation matters, and in order to have the position on record I would like to quote what is said in the explanatory memorandum because of the considerable correspondence which I have received and still receive in connection with this particular aspect of the workings of the Railways. It says—

In order to maintain the status quo, therefore, it is necessary to provide for a corresponding increase in the amount of the gratuity or annuity payable to certain servants of the Administration in terms of the Railways and Harbours Pensions Amendment Act, 1941, and it is with this end in view that the amendments to Section 3 and 4 of this Act are being made.

I do not think we have any grouse at the Minister for having introduced these amendments; I think that it is very necessary indeed. But perhaps the hon. the Minister should take this opportunity of informing the House as to whether any further legislation is going to be introduced this Session to provide for retrospective benefits to servants who wish to pay arrear contributions so as to obtain the full benefit of consolidation before retirement. This is a very important issue; it affects a great number of railway servants who are about to retire, and judging by the correspondence which I am receiving it is quite clear that the Minister must be receiving many requests also from his railway servants. I thought I would take this opportunity of asking the Minister whether he would be so good as to give the House whatever information he has in regard to the possibility of introducing further legislation this Session to give effect to the requests that are coming from so many railway servants.

I merely want to ask the Minister a short question in relation to the sale of Bantu beer. Clause 8 (5) deals with the net profits to be paid into the Benevolent Fund. It says—

In the explanatory memorandum reference is made to “non-White servants”. As the Bill reads, “non-European servants” may be Coloureds, Asiatics or any other group of non-Whites. I shall be glad if the Minister will assure the House that the profits will only be spent on the Bantu employees, and also if he will tell us why the Bill reads “non-European servants” and not “Bantu servants”.

I appreciate the support of hon. members for this Bill. In reply to the hon. member for Umhlatuzana I can only say to my regret that no legislation will be introduced this Session; the matter will be left in abeyance, probably until next session. The hon. member knows that I have given an indication that there is a possibility that wage improvements may be granted before the end of the year; it all depends on what the conditions are and if nothing unforeseen happens. It was felt that that matter should be finalized before this particular aspect of the pension question is dealt with.

In reply to the hon. member for Transkeian Territories (Mr. Hughes) I can only say that we have deliberately inserted “non-European servants”, but the net profits derived from the sale of Bantu beer will mainly be applied to Bantu servants; that also applies to the profits derived from the sale of other intoxicating liquor. But if it does happen that other non-European servants are also accommodated in the hostels and if the Administration also supplies them with intoxicating liquor, then of course they must also receive some benefit out of the profits made on the sale of that liquor.

Do they share hostels?

No, they do not share hostels but it may be possible to have separate hostels for the non-Europeans.

I notice that the Minister has considered it necessary to say that this might be extended to other types of liquor. The profits on the sale of other types of liquor should go to non-Europeans; that would be quite satisfactory provided the profits on the sale of Bantu beer could go to the Bantu.

That is the intention, because the Coloured people do not drink Bantu beer. We have no intention of selling other intoxicating liquor at this stage. It may become necessary eventually, but at the moment we only envisage selling Bantu beer to our Bantu servants, and all the profits derived from the sale of Bantu beer will be utilized for the benefit of the Bantu servants.

Motion put and agreed to.

Bill read a second time.

May I claim the privilege of the half-hour? Sir, the economic development of the country as a whole is undoubtedly a collective Cabinet responsibility, but I think, as the hon. the Minister himself has repeatedly pointed out in the past, if we are to look to a rapid economic growth in the future with rising standards of living, the prime factor that will bring that about is industrialization in South Africa. I think the Minister has made that point himself. Hitherto we have been fortunate in having had a rapid expansion of mining in the past, but mining expansion, after all, is to a large extent a fortuitous thing. For permanent prosperity and rising standards of living one must look to a steady and rapid expansion of manufacturing industry, because that in the final instance will ensure that we progress as a community. I must say that in the past whenever we on this side have questioned whether our economy is growing fast enough to create sufficient jobs for our rapidly increasing population, whether our economy is growing fast enough to raise standards of living gradually, the Minister and in particular his Deputy have been apt to quote a whole lot of statistics which to a large extent are irrelevant to this particular question, but they do seem to succeed in confusing and bewildering their own supporters and satisfying them that we are one of the countries with the most rapid rate of growth in the world. So for the purpose of this debate I would like to define what I at least mean by “economic development” and I would like the hon. the Minister to confine himself in his reply to what I am going to assert is not taking place in this country. In the first place, I think we must all agree that if a country develops rapidly, economically, it must be in a position to create sufficient jobs for all the young people who come into the labour market every year. Such a country must be able to absorb the growing labour force, in other words, and unless one is to have static society, there must be ever-increasing standards of living. I think that is as fair a test of the economic growth as one can get. It is no use if a man comes and asks you for a job, to tell him that the generation of electricity has doubled in the past ten years, or that the production of pig-iron has gone up by 50 or 60 per cent, which is rather the way the hon. Minister is apt to argue on this question of economic growth. Economic activity after all is not an end in itself, but is there to provide your growing population with ever-increasing standards of living. Now is the hon. the Minister satisfied that our economy is creating sufficient jobs, sufficient opportunities for our over-growing labour force, and is he satisfied that our standards of living are rising steadily, although slowly? I would suggest that on all the available evidence this has certainly not taken place during the past four or five years. Take the question of employment first. Our population growth is roughly at the rate of about 2 per cent a year. One must therefore assume that one’s labour force will also increase at that rate. Therefore your economy should at least increase the number of jobs that are available every year by at least 2 per cent. Now how does this compare with what has in fact happened as far as one has statistics available on the question of employment? If one looks at the latest Monthly Bulletin of Statistics for April 1962, one finds a summary of employment of mining, manufacturing. construction, transport, communication and public service, and one finds an index there and if one takes those back for five years to 1956-7, one finds that in that year the index stood at 111.9, and it rose gradually until the end of 1959-60 when it stood at 113.5, and at the end of December of last year, which is the most recent figure I have, it increased to 113.8. So you see, Mr. Chairman, that over a period of four or five years when the labour force must have increased by at least 8 per cent or 10 per cent, the number of new jobs has only increased by 2 per cent in these industries, not even quite 2 per cent. What is more alarming, Mr. Chairman, if one looks at where the jobs have been created, is to find that whereas the total numbers of people in employment in these specific industries have increased from 1,636,000 to 1,664,000, that is an increase of 28,000, if one analyses the increase, one finds that no less than 58,000 of the increase is attributable to mining. In other words, had it not been for mining, there would actually to-day have been fewer job opportunities in this country than four or five years ago. It is particularly alarming if one looks at the manufacturing industry in particular, which the hon. the Minister himself has pointed out we must look to in future as our main generator of welfare and income—if one looks at the manufacturing industry in particular, one finds that employment in the manufacturing industry reached 690,000 in 1956-7; it increased fairly rapidly up to that stage, then we find that it increased to 698,000 in 1957-8, and ever since there has been a gradual decrease, a decrease to 691,000 and to 686,000 according to the latest figures for December. I don’t even want to talk about the construction industry where there has been a far bigger drop in employment. Of course the hon. the Minister will quite rightly say that this does not cover our whole economic activity and that two very important industries are excluded, commerce and agriculture. But it is highly unlikely for other reasons that I will give later that there has been a rapid increase in employment in these two industries. After all, the whole economy develops together and it is most unlikely, particularly in agriculture, when one sees the state of agriculture during the last four or five years, that they could have generated sufficient extra jobs at improved standards of living. And commerce after all only reflects what happens in other parts of the economy. So I say that there cannot be the slightest doubt that at the rate a which we have been growing economically in the last four or five years, vast unemployment must be building up. And the amazing thing is that although our unemployment figures reflect a small increase, they do not reflect nearly the increase which must in fact have been taking place. We know of course that as far as the largest numbers of workers are concerned, the Natives as far as their unemployment problem is concerned, it is quite an easy one for the Government. If you have Native unemployment in a big area, you simply Bantustan them, and then unemployment figures don’t look too bad. But there must also be a lot of hidden unemployment amongst your Europeans, Coloureds and Indians that our figures of unemployment do not indicate, and of course it is obvious why. Only a percentage of the people who are unemployed take any interest in registering as unemployed. Let me come to the second point now. I would like the Minister to at least tell us whether he is satisfied first of all that we are generating enough jobs for our rapidly growing population on the facts that I have given him here. But let us come to the second point. The hon. the Minister might argue: Well, even if we have not been growing as rapidly in the past as we should have as far as creating jobs is concerned, nevertheless the standard of living of the people in employment at least has risen steadily. Mr. Speaker, I would like to analyse that. Unfortunately statistics as to whether the standard of living is increasing steadily in this country are not very reliable. One generally points to the improvement in the real income per capita in this country, but of course that measures a much wider spectrum than just the welfare of the people. If one for instance in a particular year has a lot of uneconomic investment, which in no way improves the standard of living, that nevertheless might be reflected if one simply goes on an average figure of the per capita real income, and it might indicate that there has been an improvement in the standards of living. However, I suggest a much simpler test. Surely the Minister will agree that in South Africa our vast masses, particularly the non-European people, are still inadequately fed; their nutrition is hopelessly inadequate, and we know the disease rate we have amongst certain sections of the non-European population in consequence. One must therefore assume that we are certainly not such a rich society that if there is an improvement in the real income of the people, people will not buy more food. In a poor society like ours, if people’s wealth increases, the first thing is that they will buy more food and your consumption per capita must go up. Well, in this respect I would like to refer the hon. the Minister to a new publication which I welcome for the additional economic information that it gives. Agrekon. Vol. 1, No. 1, January 1962, a Department of Agriculture publication where the Secretary for Agricultural Economics and Marketing writes on the difficult markets and surpluses, and he says—

Here on the evidence of the Secretary for Economics and Marketing, it is quite clear that four years after the Nationalist Government came into power, they managed to stabilize the consumption of foodstuffs. That is really what they have done. Since that period, judging by what the Secretary for Economics and Marketing writes, the per head consumption of foodstuffs has not increased in this country. No wonder his poor colleague, the Minister of Agriculture, is finding himself in such a mess to-day, for this very reason that the purchasing power is apparently not rising, or rising very slowly amongst the masses, and in consequence your consumption of food is not increasing, whereas your production of food has increased considerably as a result of improved farming methods. That of course in the long run affects the activities of the Minister’s Department very considerably, too, because it is one of the factors that is slowing down the demand for industrial products in South Africa. If any further proof is required of the fact that the standards of living of the mass of the people are not increasing rapidly it is found in the index of retail sales published by the Reserve Bank in its quarterly bulletin. If we look at the index of retail sales, the volume of retail sales, on page 27, we find that whereas the index in 1957 stood at 112, in 1961 it stood at 115. In other words, the value of retail sales increased by 3 per cent over that period of five years. But if we look at the rise in retail prices, we find that over that same period retail prices increased by no less than 9 per cent. So one can only conclude that the actual volume of retail sales as reflected by this publication indicates also that the retail demand, one of the most important factors in stimulating the economy, has been stationary or falling according to the statistics I have mentioned, instead of rising rapidly. I would therefore like to ask the hon. the Minister whether he can still be so complacent about the economic growth of the Republic. Because, as I say, the end purpose of all economic activities is to create jobs for your population at ever-increasing standards of living. That does not seem to be taking place. I would suggest that the hon. the Minister should tell the House what definite policies he has to correct this very unsatisfactory situation that we find ourselves in of a tremendous slowing down in the growth of economic development and the fact that the welfare standards do not seem to be rising, at least not very rapidly.

Let me readily admit that the Minister’s hands are severely tied by the policies of his Prime Minister and his other colleagues. Just to give a few examples, it would assist him to get industrialization moving rapidly again if he could prevail on the Minister of Labour to discard and annul the Job Reservation Act. Surely the hon. the Minister who is a trained economist himself should be able to persuade his Cabinet and his colleague, the Minister of Labour, that from a purely economic point of view this is one of the most stupid bits of legislation that has ever been put on the Statute Book. He should be able to tell them that this thing was tried 200 or 300 years ago when there was also this naïve belief that you can protect one section of the population against the other by introducing rigidities and by stopping people from changing their occupation to another occupation unless you belonged to a certain group. That was discarded more than 100 years ago in the European countries. They realized the complete fallacy of this. They realized that whilst that might be all right for a static society where you have not got rapid changes, the moment you apply it to a dynamic society like the capitalistic system we have here in South Africa, job reservation makes just no sense at all. The hon. the Minister must realize that and I would like to hear what his opinions are on this particular aspect. Just to give one other example: If the Minister could do something to stop his colleague, the Minister of Justice, from sabotaging the return in business confidence which we are experiencing at the moment in South Africa, with his so-called Sabotage Bill, it would also assist him considerably. If this Sabotage Bill does anything, it sabotages returning business confidence more than anything else.

You are talking utter nonsense now!

I admit that to sort order out of the conflicting policies of his colleagues would be a Herculean job for this Minister. I must say yesterday I heard one of the most astounding statements in this House when the Minister of Indian Affairs explained that one of the merits of his Department was that it was protecting the Indian community against the activities of other departments, in particular the Departments regulating the Group Areas Act. That shows into what a chaotic state the illogical and senseless policies of this Government are leading to that you have to appoint Ministers to protect people against the policies of other Ministers. I suppose this Minister will shortly have to do something to protect the Indian community against the Minister of Indian Affairs! Despite these handicaps inherent in the policy of the Government, South Africa has such a tremendous gross potential, industrially, that even with a very bad Government as we have at the moment, one can still grow industrially. Because after all it is the industrial community mainly that creates growth, and in this connection I was very interested to read that the hon. the Minister at the Federated Chambers of Industries dinner in December, last year, referred to a five-year plan. He pointed out quite correctly that he did not intend central planning on the communistic style, but the hon. the Minister no doubt had in mind the new fashion in even capitalistic countries like France and Italy, and even in Britain to some extent, for the Government to follow certain policies and to indicate certain targets of economic growth and then to try and get the co-operation of commerce and industry to achieve those targets. Apparently, that policy has been very successful in France and Italy, so much so, that I see that just recently the National Economic Development Council of the United Kingdom has also suggested a somewhat similar plan. I trust the hon. the Minister will give us more information on this, although I must again hasten to warn him that due to the lamentable state in which we find our economic statistics in this country, it is going to be an awfully hard job for the Minister to do this type of planning for technical reasons which he must be well aware of. If the Government is going to embark on this type of planning and encouragement, one needs fairly detailed and extensive and reliable economic statistics. I also trust that the hon. the Minister will not just tell us again about Sasol and Iscor and Escom, because as he clearly indicated in his speech, the expansion of those industries was intended as part of a wider expansion, and there is no doubt that if you cannot get private industrialization moving again, and you are simply concentrating on public utilities like that, that will not assist you in increasing the tempo of economic growth very rapidly in South Africa.

You now really talk the greatest nonsense out!

That gentleman is of course a great authority on nonsense. I would not like to enter into an argument with him, but even he should realize that it does not help to keep on generating electricity if there is no demand for it. The hon. the Minister will also no doubt tell the House, far more specifically than he has in the past, what plans he has for safeguarding South Africa’s export market. We know that vast changes are taking place overseas. The very fact that a country like the United Kingdom, the largest import country of agricultural commodities in the world, and one of the largest importers in the world, will change their tariff policy drastically if she enters the Common Market, must affect the whole world trade and it could particularly affect South African exports in view of the fact that we have imperial preferences on a large scale. Other speakers will go into this question in more detail. And of course it is not only a question of the United Kingdom market. Linked with this problem is also the Rhodesian market, a very important market for our industrial products, and that might also be vitally affected by the United Kingdom entering the Common Market. Of course the problems of adaptation have been made far more difficult by our withdrawal from the Commonwealth. Maybe the hon. the Minister can enlighten the House on this, but as far as one can judge there seems to be very little liaison between this Government and the United Kingdom Government on what quid pro quo South Africa would get if certain imperial preferences are to be abandoned or reduced, either in the Common Market as a whole, or in respect of the United Kingdom. If I am mistaken and the Minister is in close touch with the United Kingdom Government, I hope he will tell us to what extent the United Kingdom Government has undertaken to safeguard our position there. If one reads the Chamber of Industries’ report on the visit of their economist to Brussels, one also gets the impression again that this Government is lagging so far behind in its duties that just as in the case of wages for industry, industry is bound in the end to take the lead itself and to go over there and do the investigation which basically should have been done by the Government. If one reads this report—unless the Minister rejects this report completely—it would seem that South Africa has been one of the least active of the Commonwealth countries in safeguarding its position and taking steps to see that England’s entry into the Common Market will not affect our exports very adversely. We know the sorry story of the economist. It has taken more than a year to find an economist to send over there. Of course the Minister will tell us that the South African Minister in Brussels is a qualified economist. But he is also a full-time ambassador, and it is a full-time job—all the other countries seem to regard it as a full-time job, anyway. But this question will also be dealt with more fully by other speakers on this side.

Lastly, I would like to ask the hon. the Minister what his intentions are in regard to import control. In view of the tremendous increase in our foreign exchange reserves, will the Minister make a statement as to what the Government’s policy is and whether he has any relaxation in mind? The hon. the Minister must be aware that with the build-up of our foreign exchange, an inflationary situation can rise if he does not take steps. And in any event, I think there is no greater reflection on the damaging effect which this Government’s policies have on the economic life of South Africa than that South Africa, the world’s largest gold exporter, a country which has trebled its gold output since this Government came into power, is still one of the few countries in the Western world that has to have this severe type of import control. Surely we have an interest as a gold producer in free international trade and dismantling all control on trade. I would like to end by saying that in view of our strong position in exports in the Western world, because of the type of our exports and because we are such a large gold producer, we should not have this rigid control. We have this amazing situation that 17 years after the war, we still have to have this extensive degree of import control. The Minister must realize that that cannot be a good thing after the war we still have to have this extenprise as he continually tells us he does, he must realize that import control over a long period like this can only distort the price structure, can only increase the cost structure in this country. If he wants to protect industry here, it should be done by way of tariff protection. That is the sensible way to protect industry. In any event is the Minister not likely to fall foul of GATT with his rapidly improving reserve situation if he does not relax import control fairly considerably in the near future?

I think we shall be given the best reply possible to the speech by the hon. member for Jeppes (Dr. Cronje) at the next annual meeting of the Netherlands Bank. We have now listened to the shadow Minister of Economic Affairs of the United Party. As such he has to be pessimistic. But I think we shall get the best reply from the chairman of the Netherlands Bank when he addresses his next annual meeting because the hon. member for Jeppes is the chairman of the Netherlands Bank. The hon. member for Jeppes is an economist of repute and I cannot imagine that he can believe what he has said. He is surely not such a Rip van Winkle. He has to be something of a prophet of doom in the political role which he plays but as an economist he can surely not believe anything he has said. The main theme of his attack on the Government has been the question: Is our economic development such that we are creating sufficient job opportunities? Mr. Chairman, we have now gone through a period of consolidation in recent years, but even during this period of consolidation we have had sufficient job opportunities. If there was not sufficient employment, we should surely have had a considerable number of unemployed persons. But the unemployment rate is somewhere between 2 and 2½ per cent which in all countries of the world is regarded as full employment. We do not have a pool of workers in South Africa such as is found in England and America and even in Western Germany. Mr. Chairman, our problem even under consolidation has not been one of a shortage of job opportunities but actually a shortage of workers, and the only small increase in unemployment, namely, amongst the building workers, has been due to the fact that the building industry has suffered a slight decline but even this position is already improving. I just want to reply to one point which is not actually relevant but which the hon. member for Jeppes has made and which cannot be allowed to pass unchallenged, namely, that the legislation the Minister of Justice has introduced will shock this returning confidence. What nonsense! According to that argument of the hon. member sabotage will restore confidence. What absolute nonsense. The hon. member is not such a Rip van Winkle that he does not know that within a year one of our main problems in the economic sphere is going to be that we shall not have sufficient labour. Within a year. I want to congratulate most sincerely the hon. the Minister of Economic Affairs, his Department and his Deputy Minister on the new economic climate which prevails here in South Africa. There is new confidence in South Africa. The manufacturers are engaged on their expansion plans. The retail trade has improved. The Stellenbosch Research Institute reports that during the past quarter there was an almost sensational improvement in the whole economic climate, in the retail trade, in the wholesale trade, in manufacturing industry. Our industrialists are now putting their development plans into order and implementing those plans. Everywhere we see optimism and everywhere we see activity. Just look at the Stock Exchange. The Stock Exchange for the past week has not been what it has been over the past two years.

Dead still.

But that is nonsense. A rising tendency has already been making itself evident for some considerable time and this is not merely the result of the hope which exists that there will be an increase in the gold price because the main increase on the Stock Exchange has been in respect of industrial shares. There is not the slightest doubt that there is new confidence amongst the public. To what is it attributable? To what is the new economic climate, this new confidence, this new buoyancy in the economic sphere attributable? In the first place it is attributable to the confidence which this Minister and the Prime Minister have infused into the business life of South Africa. I want to congratulate the hon. the Minister on the trade missions which he sent overseas. This was the turning point and it assisted in improving the climate and as a result of all the steps taken thereafter, we have as economically sound a climate as we could wish.

The second reason for this optimistic economic climate is the vision which the Government had in announcing the Orange River scheme. I do not think that anything has had as stimulative an effect as this announcement of the Orange River scheme. This shows the Government has confidence in the future of this country and this confidence has infected the private sector as well and has also assisted in restoring confidence in the country’s economy.

I then come to the third reason for the improved economic climate, namely the confidence which the utility companies are showing in the future of South Africa. The hon. member for Jeppes knows after all what Iscor is doing; he knows about their tremendous development plans. At Vanderbijlpark alone they are now engaged on development plans involving £56,000,000—R112,000,000—for the next year. They are already engaged on those plans. In this regard I want to mention one thing specially, namely, that not one single penny of that money has been borrowed. Every penny has come out of profits. We have the tremendous development plans of Iscor for the next ten years. We have the tremendous development plans of Amcor, as a result of the large orders for pig-iron which they have obtained from Japan. They are going to extend their blast furnaces at Newcastle. Does the hon. member for Jeppes want to say that he knows nothing about that? They will start making deliveries within the next two years and for them to do so an additional train will have to travel every day throughout the year between Newcastle and Durban so that they can export what they are going to produce at the new blast furnaces at Newcastle. Does the hon. member not realize what this will mean? He surely knows of Foscor’s development plans. He knows of the development plans of the motor industry; he knows of the development plans of Sasol; he knows about all these things.

Apparently he knows nothing.

How many “jobs” will this development not create? The hon. member surely knows that the time for consolidation is past; it is already months past and development is already taking place. This confidence which the utility companies are showing in the confidence of South Africa has so stimulated our economy that it could have no other effect but to penetrate to the private sector as well. And these development plans on the part of the utility companies alone will create our greatest shortage of manpower and labour resources in the next year or two—I think the hon. the Minister will have to prepare himself for this. There is already a tremendous shortage of scientists. I think the Minister must prepare himself for the fact that this will be one of his main headaches within a year or two. And then we have prophets of doom like the hon. member for Jeppes and the hon. member for Port Elizabeth South (Mr. Plewman) who sits next to him—but he will always look as unhappy as he does now. This confidence which the Government has initiated has penetrated to the utility companies and thereafter to the private companies. I want to congratulate private companies like Anglo American and African Explosives to-day on the initiative which they have shown in their development plans. The plans of African Explosives alone must create hundreds of job opportunities at Modderfontein. Then there is Union Steel Corporation, a semi-private undertaking with its development plans. There is the Massey-Ferguson organization which is now seeing whether it cannot manufacture tractors in South Africa and anyone who can read the signs of the times will know that within a few years we shall have our own tractors under the guidance of these people. Millions and millions of pounds are being invested in the development of this country. Therefore, Mr. Chairman, our main problem will not be a shortage of jobs, as the hon. member for Jeppes says, our main problem will be exactly the opposite.

This new economic climate in South Africa is one of the most wonderful things which has happened over the past ten years and for anyone who can observe it, it is clear that we are on the threshold of the greatest economic development we have ever seen. Nothing can prevent it, except an outside catastrophe or something of that nature. Hon. members opposite can now stop trying to sabotage it. The impression which they can create is not even a drop in the ocean. They cannot sabotage it and nothing can stop it.

I now want to make an appeal to the hon. the Minister, while we are engaged on new economic development, to consider whether the time has not come for the establishment of a new Sasol. It is now quite clear that notwithstanding all the prophesies of doom which come from hon. members opposite, that Sasol has been an outstanding economic and financial success. [Time limit.]

The hon. member for Vereeniging (Mr. B. Coetzee) pointed out that there was a shortage of skilled workers. I certainly agree with that, but that shortage has been occasioned completely by the Government’s immigration policy. I would say that this country has again been sacrificed on the altar of their ideology. He said everything in the garden was lovely; there was no unemployment anywhere. He does not seem to know anything about the building industry. As far as we on this side of the House are concerned, our motto should be “export or die”. In this connection, Mr. Chairman, I want to refer to a statement made by the hon. the Minister to the Export Trade Convention this week, in which he is reported to have said—

That, of course, means the countries to our north. He goes on to say—

These are surprising statements, Mr. Chairman. Industry in this country has always, or at least till very recently, until the Prime Minister succeeded in his efforts to get us out of the Commonwealth, known that South Africa’s future lay in being the workshop of Africa. The availability of raw material, our geography and cheap labour were the main factors which were to help. Now the Minister says we must forget these under-developed countries, they are not for us; the industrially advanced countries represent the markets to which we should devote particular attention! This means that in the Minister’s opinion the emerging African states to the north of us are virtually closed to us. This we know. We also know, Sir, that this is due to the Government’s policy and the Government’s policy alone. And we know that we will have a tremendous job to put it right when we take over in the not so distant future. Mr. Chairman, that statement of the Minister’s was reported on the 15th of this month; on the 16th of this month the hon. the Minister of Information is reported to have shown a documentary picture of 300 Coloured people entitled “Workshop of the Continent”. On the 16th, too, in the Cape Argus, Mr. W. A. Horrocks, the country’s senior trade envoy, is reported to have told the Export Trade Convention that—

So what do we have, Mr. Chairman? The Minister of Economic Affairs says we must ignore Africa; the Minister of Information says we are the workshop of the Continent; the Minister of Economic Affairs says we must devote particular attention to the markets in the industrially advanced countries. The country’s senior envoy warns us against these countries, except probably for the sale of primary products and foodstuffs. Can you beat that, Mr. Chairman? And now to make confusion worse confounded the Prime Minister enters the field and tells the Convention not to worry about our trade difficulties with the African states …

Order! I want to draw the hon. member’s attention to Rule 60 which says that an hon. member should not read his speech.

Thank you, Mr. Chairman. I have on this particular occasion been quoting from the Prime Minister’s speech. Our trade difficulties with the African states will pass according to the Prime Minister. He says they will pass and we must in the meantime concentrate on the markets in the more advanced countries. Truly, Mr. Chairman, the fortunes of the exporters have been thrown in the gutter; there is no other word for it. This Minister must admit that the policy of “leave it to Hendrik” is getting us nowhere.

Before putting certain questions to the Minister I want to draw his attention to the urgency of this matter of finding new markets to replace those so cavalierly thrown away by the Prime Minister. The Minister knows that governments can break down markets as this Government has done and he knows that they cannot rebuild them. He has admitted this on many occasions. His trade missions have also admitted this. The only people who can help the exporters are the exporters themselves by hard work. That was what the Trade Missions said and that was what the Minister said. Now comes the question of urgency, Sir. Our country’s gold production which is the backbone of the whole country will come to a peak in 1970 or 1971, we are told. Thereafter it will dwindle unless a miracle happens again. We are all hoping for an increase in the price of gold but it has not come about and it does not look as if it is any closer than it was five years ago. While we have this life-saving industry we should be putting in every effort of the country to establish those industries which have to take the place of the gold-mining industry later. All the time we have left is between now and 1970, thereafter our gold production will dwindle.

I want to ask the hon. the Minister a few questions: Who is right about our being the workshop of Africa—he or the Minister of Information? Who is right in saying that the African markets to our north are closed to us or not—he or the Prime Minister? I want to ask him another question: Is it correct to state that only manufactured goods which contain a large proportion of our own raw materials and are manufactured by a large proportion of our own cheap Native labour, have any chance at all of selling overseas? If so, does this not affect his policy in regard to White industries, i.e. those with a very large proportion of White workers as opposed to Native workers? Because that sort of product comes in the main from the White areas, the White areas where the White skilled workers work. Then I want to ask him a further question: Which is the best place for our exporters to battle in for sales: Africa, Asia (both closed to us), Europe, South America, North America or where? He must let us and the people outside know. Then I want to ask a further question: Has he statistics relating to those particular South African manufacturers who have already lost markets in Africa and on the European Common Market owing to the internal tariffs being reduced between the member countries of those organizations? If he has not got that information. Sir, I say that he and his Deputy are failing in their duty. Has he statistics of those exports, product by product, which will be affected by the Common Market? And has he advised the producers of those particular products? Is he in contact with the United Kingdom or elsewhere in connection with our wine, fruit, our wattle products, our sugar, our maize products, etc.? I hope the Minister will not give us the same misleading reply which the Deputy Minister give us in connection with sugar earlier in this Session. Will the hon. the Minister, too, also tell us why it has been left to the last few days for an announcement to be made by the hon. the Prime Minister, and not by him, that an economist is to be appointed to Brussels? That should have been dealt with by him, not by the Prime Minister.

Finally, Mr. Chairman, I want to ask the Minister once more does he think that this policy of “leaving it to Hendrik” gets us anywhere except into trouble?

Mr. Chairman, it must be very difficult for hon. members of the Opposition to debate and to criticize the Government on this Vote, because they are now discussing circumstances which differ so greatly from what they prophesied 11 months ago would be the position. You will remember, Mr. Chairman, that in June last year, when we had a financial debate here, it was precisely the hon. member for Benoni (Mr. Ross) who told the House that we were so weakening our foreign exchange position that we would have to devalue. It is the hon. member who said that we would be obliged to devalue and the hon. member for Jeppes (Dr. Cronje) was the one who shouted: “Hear, hear.” His whole party said in this House that we would devalue. Now they are depicting a picture which refutes completely their own prophesies. They have come here to-day at a time when our foreign exchange position is stronger than it has been for years. The circumstances are such that the hon. member for Jeppes has told the Minister: What are you going to do with all this foreign exchange? You should allow more goods to be imported and to use the money. That is the position which we have reached. And now these hon. members have had to swallow every word they said 11 months ago, just as for the rest of the year they will have to swallow for all they are worth everything they say here to-day. They cannot put forward any criticism of the Government which they will not have to swallow later.

Take the hon. member who has just spoken. He has actually told us that we had African markets at our disposal but the Prime Minister took us out of the Commonwealth and now we no longer have those markets. Just imagine a worse lot of nonsense than such a submission. I now want to ask the hon. member to name me one single African market which we had and which we have lost thought leaving the Commonwealth.

What about the machinery in Ghana?

The hon. member who is a comrade in arms of the Ghanians, as it often seems to me, should know that the boycott announcement by Ghana and other Central African countries was made long before we left the Commonwealth. The hon. member should also know that now that we are out of the Commonwealth, Ghana has come crawling to ask that we should please supply certain goods which they require. Ghana say that “boycott” means that they can still buy what they need from us. The boycott should only be one-sided and not on both sides. The hon. member should please check his facts before he talks such nonsense in this Committee.

He has said one thing, namely that we shall have to establish new industries to replace the gold mines. But, Mr. Chairman, whenever I have advocated that in this House, and have said that we should transfer to Loan Account a considerable amount annually from the large sums which we receive from the gold mines, precisely in order to develop such industries, hon. members opposite have opposed me. There has been systematic opposition from the United Party—such a step must not be taken.

But I now want to turn to the main United Party speaker, the hon. member for Jeppes. He has made one or two submissions which I feel we cannot allow to pass unchallenged. The hon. member for Vereeniging (Mr. B. Coetzee) has already answered him reasonably fully. However, he did not answer all the points. I now want to tell the hon. member for Jeppes this. I have already told him this, namely that he is a good economist, so good even that the Government could use him to advantage on the Board of Trade and Industries. He then entered politics and in political life he has landed in a party which is following the wrong economic policy, which is following the wrong policy in practically every sphere. Now he has to rise year after year and hold himself out as an expert who can see terrible mistakes in this Government’s policy. Does the House know what he has done? He has not regarded these matters on a scientific basis as one would expect of an economist. No, he has approached these matters from a petty party political point of view, and then he makes nonsensical submissions such as those he made here this morning. We get these bank reports which he makes, and to which the hon. member for Vereeniging has referred. The other day I told him that he should watch out what he says in the House because I shall quote his own bank reports to him. Unfortunately I have not brought them with me. I am sorry, but I am still going to bring them before to-night. If he continues with this sort of talk, then I shall throw his own words in his face. Mr. Chairman, I really do not think that this hon. member is so foolish that he believes what he stated this morning in this Committee.

Argue and do not be personal.

One has to be a little personal with a person who violates his own calling, his own subject in which he claims to be an expert, to such an extent that he throws overboard all its basic principles in order to find a cheap argument. The hon. member has said here: Look, there is no development in the private sector, and you must please not tell us about the development of Iscor, Foscor, Escom and Amcor and those undertakings, because these are things for which the State is responsible and which it is initiating because the private sector is not developing. Why is he so afraid of this development? Development to the tune of thousands of millions of rand has been announced by the utility companies. Why is he afraid that we shall mention this? No, he has tried to build up an argument in order to bring the Committee under the impression that nothing is being done to develop our economy, whilst everything possible is being done and with very great success.

I just want to take another argument of the hon. member. He has said that there has not been an increase in the real income of the public, because if there had been such an increase, there would have been an increased consumption of food. Have we ever heard a more unscientific submission than this, and this from a man who claims to be an economist? I ask: How on earth can a person who claims to be an economist submit such a nonsensical argument?

Do not keep on asking questions; answer them.

Yes, I shall answer him. I am answering him. The actual position is that if a man has a larger income—and statistics show us that during the 14 years we have been in power, the real income has risen by approximately 30 per cent. He cannot deny that, no matter what he says. One of the characteristics of a rising standard of living, as reflected by these figures, is that a larger percentage of income is devoted to things other than foodstuffs and not to foodstuffs as such. The public buy things with a utility value, other than food. That is the first characteristic one encounters. They buy radios, motor-cars, they go to bioscope, which they perhaps did not do before. I wish members would go to the non-White bioscopes in Pretoria and Johannesburg, to see how the Natives are queueing to get into the bioscopes. We see this day after day, and 10 to 15 years ago we did not see it. Go to the races and hon. members will see the same thing—how they gamble with their money there. But, Mr. Chairman, that is not all. A second main characteristic of a rising real income is that the careful man saves more. What do we find in this regard? In 1948 savings in South Africa totalled approximately £100,000,000—R200,000,000. This figure has risen to such an extent that to-day it is approximately R1,100,000,000 per annum. Expressed in percentages this is the highest in the whole world—between 25 per cent and 30 per cent of the net national income is being saved to-day. And who is saving this money? It is not so much the rich and important man. The rich man saves in his way the amounts which he wants to set aside. But ask your building societies and your savings banks; ask the deposit-receiving institutions! You know, Mr. Chairman, that the number of savings accounts has increased tenfold during the 14 years we have been in power. I do not know how many times the amounts involved have doubled during the few years we have been in power. Here we have a concrete indication of the rising standard of living in South Africa, and no matter what the hon. member may say, he cannot argue that fact away. Then the hon. member went on to say that the job reservation legislation had harmed our industrial development. [Time limit.]

It seems to me that the last two speakers on the Government side have completely failed to refute the statements made by the hon. member for Jeppes (Dr. Cronje). They have also completely failed to refute the unemployment figures. It is all very well to tell us about queues of Bantu standing outside bioscopes waiting to go in. They do not take into account the long queues of Bantu at the unemployment bureaux all over the country. Go to East London and look at the queues there and see the large numbers who are turned away because there is no employment. These are indisputable facts. Another point which they have failed to take into account is the statement made by the hon. the Minister at recent conferences, to the effect that it is necessary to develop his five-year plan and to develop our export industry in order to find employment for the growing numbers of unemployed. Those are points which the last two speakers on the Government side have overlooked altogether.

I would like to say that I am very pleased indeed that the hon. Minister of Economic Affairs has announced this five-year plan and especially that he is linking it up with the idea of export industries. I have no doubt that he has studied the whole position thoroughly but I want to draw his attention to one or two points. In order to derive the maximum results from these export industries it seems to me that he and the whole country and all industrialists interested in this matter, will have to develop an entirely new broad outlook with a far-sighted concept, taking into account all the industrial potentialities of the country, if this plan is to have the maximum desired effect. If South Africa is to maintain its position, its industrial, scientific and commercial leadership in Africa, we will have to take an entirely new outlook of the whole industrial situation in South Africa. Our present industrial complex is built up on the production of gold and cheap labour to extract that gold. But as previous speakers on this side have frequently mentioned that gold will eventually peter out. We will then have to take that inevitability into account and look for other avenues of employment. A vast amount of capital has been invested in the areas surrounding the gold mines. Capital has been sunk into housing and township schemes. All these factors will have to be taken into account. We will have to provide industries to take the place of the gold mines in those areas. I maintain that when we come to consider export industries we will have to take a new look at the whole position. This R6,000 mentioned by the Minister of Finance is the only apparent financial provision made for the development of export industries, and it seems to me to be quite inadequate. I mention that only in passing. I would like the Minister of Economic Affairs to give us more details about what his five-year plan means and what he has in mind in regard to the development of the export industries. Up to the present his statement seems to be very nebulous and just covers vague ideas. The country expects him to be more specific. To get the maximum result from the export industries I think we must also take into account the fact that the big industrial countries of the world all have their export industries based on seaports, whereas our present development of industries is far inland. If we have to compete with other countries of the world we will find it very difficult to pay railage to the coast and then shipping rates, when the railage for 700 miles from Johannesburg to East London costs more than the freight for 7,000 miles by sea. Therefore I feel that we will have to take into account various factors when it comes to the matter of export industries. We will have to consider what the requirements are for suitable new areas in which to develop those export industries. I feel we will have to develop a new industrial complex based on seaports, and we will have to look for areas which provide abundant water and unencumbered land in the proximity of seaports. We will have to take into account, whether we like it or not, the Government’s policy in regard to border industries, and find areas which are in close contact with the densely populated Bantu areas. I submit that in the corridor area between the Transkei and the Ciskei, the area immediately inland from East London, we have all those requirements par excellence. That area has been held back in the past to a large extent, due to its distance from the main inland markets, but I submit that if we are considering export industries, that disability falls away, and it will be difficult to find an area which gives more scope for our developing export industries. We will have to compete with countries overseas. The European industrial countries are reaching the limits of their labour supplies. In America the wages are very high. Australia and New Zealand have to import all their labour. In much of Africa and Southern Asia there are plentiful labour supplies, but the climate is not healthy, whereas at East London we have all the necessary facilities for developing industries, particularly for manufacturing the raw materials into the finished articles, instead of now exporting them to other countries and those articles coming back in the finished form. In a coastal area like East London, which has not been over-developed, there is plenty of unencumbered land and all the other facilities necessary for the establishment of export industries, and I submit to the Minister that in the development of this and in his five-year plan lies the great new idea which South Africa needs.

In this connection I should also like to suggest to the Minister that he should give further consideration to the idea which has already been expressed in this House, of a free port, for which East London is ideally suitable.

The hon. member who has just sat down will forgive me if I do not reply to him. I want to come back to certain remarks made by the hon. member for Jeppes (Dr. Cronje), the Opposition’s shadow Minister of Economic Affairs, particularly the remarks he made about the Common Market. He has said that this is going to create tremendous problems for us, particularly as a result of the fact that we are no longer a member of the Commonwealth and that practically insuperable problems await us in the future if the United Kingdom becomes a member of the Common Market. Now, as a good politician, the hon. member has immediately grasped this uncertainty in order to conjure up as many fears as he possibly can. He has done so because we are faced with a very difficult problem in the sense that there is a tremendous degree of uncertainty as to the exact conditions on which the United Kingdom will become a member of the Common Market. But the very first point the hon. member has made by saying that we shall be penalized because we are no longer a member of the Commonwealth is refuted by the facts because as far back as November last year the six member countries of the Common Market stated clearly that Australia, Canada and New Zealand would not be permitted to become members simultaneously with the application made by the United Kingdom. It was stated that other Commonwealth countries whose exports were not so large and who could compete with the six original member countries of the Common Market would be permitted. Consequently, I simply cannot see how this position will harm us because we are no longer a member of the Commonwealth. That was his first argument.

I now come to the second argument, namely that unlike New Zealand and Australia we are in the exceptionally favourable position that 80 per cent of our exports consist of raw materials or of goods which are of essential importance to Britain and the other six members of the Common Market. We are therefore in this regard in a very favourable position as well. There is the further aspect that we occupy a unique position as regards our gold, which represents 40 per cent of our exports and which we can sell in the free world at a fixed price. Fourthly, the exports of our wool which represents 11 per cent of our exports, are also of cardinal importance because this is one of the essential raw materials for the six countries of the Common Market. The same applies to other minerals which represent 13 per cent of our exports. We are therefore in a very favourable position as regards these matters. I want to concede at once that our wine and fruit exporters may be faced with difficulties as a result of this agreement and I do not want to lose sight of this fact, but on the other hand I also believe that, just as in the past, we can show sufficient enterprise to develop markets elsewhere in the world if we are harmed in that regard. The hon. member has therefore made use of this uncertain situation to arouse further fears which will certainly not have a stimulating effect on the sound economic climate about which he has had so much to say. Here we are faced with a tardiness to invest. One of the main features which we saw in the last budget was in fact an emphasis of this aspect. But on the other hand this policy of the Opposition of conjuring up bogies and arousing fears and saying that everything will collapse the moment the United Kingdom enters the Common Market will not stimulate our economy, and these arguments are also devoid of all truth, as I have shown. Allow me to quote briefly what an authority has said in this regard. Here I have the well-known Finance and Trade Review of Volkskas. and in the December issue appears a particularly interesting speech made by Mr. Bryan, the Chief British Trade Commissioner in South Africa, towards the end of last year. One of the important aspects which he emphasizes is precisely that while England is not yet a member of the Common Market, her exports to Western Europe have increased considerably. He said—

He says that if this is the position in the case of England there is no reason why the same should not apply to South Africa as well. The conclusion of his whole speech was the following—

I think that this opinion of Mr. Bryan, who is certainly an authority in this field, is a conclusive reply to the fears which the hon. member for Jeppes has tried to create and the sombre picture he has tried to depict regarding the United Kingdom’s possible membership of the Common Market. As I have said, in the times in which we live, seeing that we realize that we are faced with a great problem in providing sufficient employment and the necessity for maintaining the tempo of our economic development at such a rate that we can provide job opportunities to future generations, and seeing that this is one of the main problems submitted to the House in the Budget, the hon. member is certainly not justified, as a good economist, in allowing his political convictions to blind him to such an extent that he loses sight completely of these other facts. I do not want to say that if the United Kingdom joins the Common Market it will not create problems for us. As regards our wine, fruit and other agricultural products, grave problems may be created. But in the main the fact remains that the submission which the Opposition always make, namely that because we have left the Commonwealth, we shall be penalized as a result of the fact that England has joined the Common Market, is devoid of all truth. The contrary is true, namely that we are in a more favourable position as regards our essential exports of gold, wool and basic minerals than New Zealand, Australia or even Canada, and secondly, it must be remembered that it is not a sine quo non that because England has joined the Common Market it will automatically follow that Australia, New Zealand and Canada will have to join it also. That is not the position at all and it surprises me to hear from the hon. member for Jeppes, who is the shadow Minister of Economic Affairs, that it will automatically follow that the other Commonwealth countries will become members of the Common Market together with the United Kingdom. [Time limit.]

I am glad that I have the opportunity of following the hon. member for Mayfair (Dr. Luttig), because it is speeches like the one he has made this morning that has created so much fear on the question of the Common Market. He has told us that Canada, Australia and New Zealand will be in exactly the same trouble as we are, because they will not be admitted to membership of the Common Market. But he forgot to tell us two things, firstly that in the negotiations taking place between the United Kingdom and the Common Market the U.K. is representing those countries; and, secondly, that from the latest information that has appeared in the Press it seems that if the U.K. enters the Common Market the other members of the Commonwealth will have at least until 1970 to adjust their position in relation to the Common Market. He has also told us, correctly, that we are in a fairly strong position, because so much of our exports comprise gold, agricultural products, and basic raw materials like base minerals. It is true that a number of these items are what are called the sensitive items, and that we will have a certain latitude in regard to these items. But there are two factors we have to take into consideration. The first is that on the agricultural side the members of the Common Market themselves are constantly pushing for lower tariffs on agricultural products, and that policies are being developed to enable this to take place. The other fact is that it is no good we in this country saying: Do not let us worry, because we can export our gold and our base minerals and our agricultural products, when the whole drive at the moment is in respect of the export of manufactured products. Where do we stand in regard to manufactured products? The speech made by the hon. member for Mayfair merely reflects what was said by Ministers of this Government, and that is why we are so perturbed about the position. It is over 12 months ago that this matter of the Common Market was first raised by commerce and industry, and raised in this House. What have we had in the meantime? The hon. the Prime Minister tells us that he is not obsessed with the idea of the Common Market, but that we are. The hon. the Minister of Economic Affairs tells us that he has had discussions with the E.E.C. and that his Department has made studies and that reports have been drawn up, and that the Republic was represented at various conferences. We also know that the question of the E.E.C. was dealt with by the Prime Minister’s Economic Advisory Committee. But there seems to me a sort of laisser-faire attitude in regard to this matter; it is not really important, we will deal with it in our own time, and South Africa really will not be affected. Now I do not want to mention this question of the economist again. I only hope I am invited to see him off when he sails to represent the Republic of South Africa. We have heard about it for so long that I would be very happy to have the opportunity of seeing him off when he goes to represent us. Sir, what are the basic facts? In the E.E.C. you have one of the great trading blocs in the world, which is forging ahead with terrific rapidity. In four years, it is said in an article—

The other factor I mentioned, and which I think one must stress, is the link between the E.E.C. and Africa. It seems to be something which we disregard. What is the position in relation to Africa? Through the old ties of the member-states of the E.E.C., particularly France with her old dependancies, which are now independent states, you have a very realistic and very important tie between Africa and the Common Market. In the Cape Argus of 10 April it was reported that the Senegalese ambassador to the E.E.C.—and it may be of interest to hon. members to know that the Senegalese have an ambassador to the E.E.C.—speaking for all the African states, had requested R1,214,000,000 in aid spread over the next five years. Sir, we know that economic help always has a tail attached to it, and if the E.E.C. is going to put these millions of rand into Africa, it will not be a free gift, but it will be tied up with trade and we have to be aware of it. I do not want to stress again the question of the U.K., except to say that from the latest reports it does appear that the entry of the U.K. into the E.E.C. can be fairly soon. I hope the Minister will know more about that than we do and that he will tell us to-day what the position is in that regard. We do not seem to view this matter with very great seriousness, but the U.S.A. does. The Trade Expansion Act of 1962. which was introduced in Congress by the President, is designed to bring about increased trade by making it easier for goods purchased abroad to enter the U.S. markets. The President said that easier entry into the United States markets of these goods would mean easier entry by United States producers into overseas markets, and the report I have here reads as follows—

That is the situation we are faced with, and what are we doing about it? I hone the Minister will tell us to-day, because the facts at our disposal indicate that we have little contact with the E.E.C., and that the statistical information we require is not available. Here I want to say how pleased I am that the Department has sent out a questionnaire which will give us some basic information in regard to these vital statistics, and I hope that as the result of it we will be in a better position to deal with this matter. Organized industry has said for some considerable time that the report produced by their economist whom they sent over to Europe at their expense is the only comprehensive document that is available on the situation in Brussels, and I understand that they have gone so far as to say to the Minister that if he cannot find an economist they might be able to make one available to the Government. I see from the remarks of Mr. Steyn at the convention in Johannesburg that the Government is apparently not very keen on having private individuals being dispersed among Government officials, but we would like to hear from the Minister, if an economist has not yet been appointed, what his attitude is towards this offer made by organized industry.

I would like to ask one or two questions. What representations have been made to the Government by exporting firms who fear that they will lose their export markets? Secondly, does the Minister believe it is possible for us to become an associate member of the E.E.C. or not, and if not, what steps can be taken under G.A.T.T. to protect our interests? [Time limit.]

I believe only in South Africa. I am not a pessimist. I am not sitting on an ash-heap, and that is the reason why the United Party is in the position in which it is. I believe in loyalty to my nation. If one takes only the development of industries during the time this Government has been in power, it proves my whole case. Whereas the turnover during the United Party régime was about £500,000,000, it is to-day more than £2,000,000,000. That is the reply to the allegations of a group of people who are absolute pessimists and who are trying to break down everything that has been built up in S.A., just for the sake of making a little political capital, which they are not making anyhow because the public knows them too well already. Some hon. members here spoke about agriculture. I do not want to reply to that, but I just want to tell them that there was a time when our people were so hungry that they had to stand in queues as the result of the agricultural policy of the United Party. But I want to pass on to something else.

I want to discuss this splendid ideal we have, the Orange River scheme. [Laughter.] That just shows the intelligence of hon. members opposite. That scheme will be built with two objects in view. The one is the decentralization of industry, and I want to speak about the role industry will play in our development. We have the Tennessee Valley in America, and it is power which made a success of that scheme, and that is what I want to discuss. I just want to tell the Minister that I believe that there will be great industrial development as the result of the Orange River scheme. The Tennessee Valley scheme was built in three areas which were the poorest and the dryest areas in America, but as the result of the general development which took place there those are to-day the most prosperous areas in America. In view of the fact that the Tennessee Valley and the Orange River have much the same location, I feel that we should discuss the industrial development there. In the upper parts of that valley power is generated for industrial development. That is in the first 300 miles of the Tennessee Valley where one finds all those large power-stations which led to the decentralization of industry, and there we to-day have the greatest development in America and the decentralization of industries. From Knoxville downwards, the top part of the Tennessee Valley, one finds one factory after another. As the result of the cheap power available there—and water power is the cheapest power available—one finds that there was so much development in those areas that the other states in America were even jealous of it. They point out that those areas have the cheapest power and that they are therefore more privileged than the other states. Even the atomic power which was developed there was done by means of the cheap power available there. Then one also finds the large phosphate factories which were war-time factories but which were converted after the war into phosphate factories which enabled agriculture to produce cheaply. It is essential that the agricultural development in this country should go hand in hand with the development of the Orange River scheme. Just as in America, we should try to bring the fertilizer factories nearer to the agricultural areas in order to keep down railage as much as possible. The industrial development in those areas will also promote agricultural development. Sir, I had the honour of spending seven days in the Tennessee Valley with the authorities there, and I wish my hon. friends who have never been there could see what development has taken place there. We can have the same development in this country, but we shall have to establish a body to co-ordinate all the various activities. Such a body must consist of representatives of agriculture and industry and other interested parties. We cannot expect this co-ordination to be left to the departments only; a body will have to be established consisting of representatives of all the people who in future will derive benefit from the Orange River scheme, viz industries, labour, agriculture, etc. The planning will take years, and seeing that it is such a great project I want to ask that the hon. the Minister of Economic Affairs should already start planning at this stage, together with the other Departments. The first results of the development of this scheme will only be derived after six years, but the complete planning must be done before then. I want to point out that as the result of the development of this scheme there will also be great industrial development in the Eastern Province, where more than ten power stations will be built, where one already has national roads and railways. I feel that we should all be grateful for having this great project, and although there are people who to-day talk about the Orange River scheme in a derogatory manner, we must admit that it is one of the most ambitious schemes ever tackled in South Africa. It reminds me of the days when diamonds were discovered in South Africa and when later gold was also discovered. The discovery of diamonds and gold created a new future for South Africa, but I say that this Orange River scheme is of as great potential importance to our future as the discovery of gold was. I believe that we must have gold for the development of the country, but we need this scheme just as much. They must help each other; the one complements the other, and therefore I want to say that we should already start making plans for the future.

I should have liked to follow up what the hon. member for Cradock (Mr. G. F. H. Bekker) has just said about the Orange River scheme, but I think a better opportunity to discuss this matter will be when we have plans before us instead of promises. There is an old Netherlands saying that “By gebrek aan brood eet men pastei”.

“Korsies van pastei”.

We know that you are not very bright.

That is a very natural remark because I was just going to indicate that having listened to some of the members opposite—and I will exclude some but certainly not the first two who entered this debate—it seems quite clear that they have changed this motto to read, “By gebrek aan argumente word mens persoonlik”. My colleague, the hon. member for Jeppes (Dr. Cronje), has pointed out that as the world’s largest gold producer South Africa is more dependent than almost any other country on international trade, and yet our external trade contacts are possibly at a lower ebb to-day than they have ever been before. Moreover, the Government’s stranglehold on private enterprise by means of arbitrary control and authoritarian restrictions is greater now than ever before.

The export section of the hon. the Minister’s Department which was created a short while ago and showed much promise, now seems to have faded into insignificance. The Director of Export Promotion resigned at the end of 1961, and as far as I am aware that position is still vacant. If an appointment has been made, I hope the hon. the Minister will let us know and tell us when it was made. If the post is still vacant I hope he will tell us what he intends doing about it. According to Press information the Export Advisory Committee has apparently not met since August 1961, and I hope the hon. the Minister will give us some information in that regard as well. There has also been a failure on the part of the Minister to follow up the special Trade Commission’s recommendations in regard to strengthening the permanent Trade Commission staff overseas, and again I ask the hon. the Minister to tell us precisely what has happened there. Again, one would like him to give us plans and not promises. It is no wonder therefore that the hopes of the business community are now being directed at the establishment of an Export Corporation to provide specialist export services in the commercial capitals of the world. All I can say is that that seems to me to be a substitute because of the Government’s failure in regard to the promotion of export trade. It is at the present moment the most promising outcome of the Export Trade Convention which is sitting at present. Sir, to hold export trade conventions is all very well, but not sufficient. At this very time when the centre of gravity of world affairs is shifting from the glories of empires to the growth of nations and when the door is being opened in Africa to more freedom for more people, an inevitable result of which is that the masses are to-day counting for more than they ever did before, this Government, for purely ideological reasons, is prepared to close the door to markets which are virtually on our doorstep and to ignore this growing economic demand in new Africa. I emphasize this because of the paradox of the Government’s approach to this rising of self-assertion of the masses, which is taking place here and elsewhere in Africa. The paradox of the situation is entirely one of the Government’s own making through its own policy, and it is this; Although the Prime Minister and his Government have declared their intention and their willingness to give not only de facto but also de jure recognition to this growth of political consciousness and this right of self-determination to the African peoples in the Transkei, yet on the other hand the Government declines or neglects to give any sort of official commercial recognition to the emergent Black States on the rest of the African Continent. In no single State in this new Africa, south of the Sahara, has South Africa got an official representative. In the whole of new Africa it has neither diplomatic nor consular nor trade representation. Such trade representation as there is, is still restricted to those countries where it existed when this Government got into power, or before this Government got into power. Meanwhile practically every other nation is expanding its economic interests and its trade associations in this new market. The hon. the Minister is reported as having said at the Export Trade Convention that South Africa should look to the established markets rather than to the newly developing markets. I hope he will take this opportunity of expanding on that aspect of the matter because it seems to me short sighted and certainly not in the trade interests of South Africa. You see, Sir, I myself have taken the trouble to see what is happening in that regard in some of these new States, particularly those on the west coast of Africa. I described the situation which I saw there two years ago in these words I said—

Sir, the position has not improved in the two years; it has only become worse. To emphasize what the position is I ended my discription of the position by adapting, as I had seen the position, the views and the language used some years before by Gen. Smuts. This is how I adapted his views—

The President of the Johannesburg Stock Exchange expressed the same sentiments recently much more crisply. He said in effect that it was incongruous for South Africa to seek markets in the East and to ignore those on our very doorstep. Sir, I endorse that and I endorse it completely. It is no answer to the Government’s failure to face changing circumstances in the rest of Africa for hon. members opposite to talk, as they did again to-day, of these new States being unfriendly and to ask “Who started trade boycotts?” or for the hon. the Minister of Finance to say somewhat gloatingly, after he had quoted certain statistics in the Budget debate, “So much for boycotts”. Sir, that is not the way in which trade and commerce on an international scale are conducted. Rebuffs in international trade must be expected from time to time. Small men might talk in the way they do to-day and have done previously from the benches opposite, but one expects something better and bigger from the Government.

Business suspended at 12.45 p.m. and resumed at 2.20 p.m.

What I have to say here will not detain the House long. Actually, it does not fit in with the course the debate took this morning, but I have a matter that I would like to bring to the attention of the Minister. We have heard a lot recently about the coming great developments in regard to the building of dams in the Orange River. I just want to ask the hon. the Minister whether his Department has already investigated, or whether he is busy investigating, the possibility of generating hydro-electric power at those dams which are to be built in the Orange River, and whether the Minister’s Department has, perhaps, negotiated with Escom to generate this power if it cannot be done by the State itself. Then I should like to know what the possibilities are of linking up the hydro-electric power generated there with the power already generated by Escom in order to have a network of power lines which will supply the Southern Free State and also the Northern Cape with the same power which is now being used in other places situated nearer to Escom itself. I should like to know whether it is possible in this way also to supply the Southern Free State and the Northern Cape with cheaper electric power.

Secondly, I just want to bring another matter to the notice of the hon. the Minister, namely this: We often hear complaints that articles manufactured in this country are not up to standard. Some of my voters have brought it to my notice that certain plough shares, inter alia, are not of the same quality as others. I know that if these people make use of the Bureau of Standards they will be protected against this sort of thing, by buying articles which bear the mark of the Bureau of Standards. I just want to ask the Minister whether it is possible in some way of other to compel all articles manufactured and sold to the public to bear the mark of the Bureau of Standards, so that the wrong impression will not be created that locally manufactured articles are necessarily of an inferior quality. I just want to have the Minister’s opinion in regard to these two matters.

When business was interrupted at the lunch hour, I had referred to the fact that the Government’s vision about what was happening in Africa had been completely clouded by its political policy, and I had commented on the Government’s failure or neglect to give any sort of official of commercial recognition to the emerging States of Africa. I pointed out that it was no answer to the Government’s failure to criticize what had happened in the past. I also pointed out that rebuffs in international trade were something that must be expected from time to time, and that the Government must take the long view in regard to matters of that kind. You see, Sir, the “Boston Tea Party” made history, but it certainly never stopped trade. In the same way the Government must take the long view in regard to this matter. It must not be influenced by the truculent and uncompromising views which are expressed from that side of the House at times. I hope the hon. the Minister will take steps and will inform the House that he intends taking steps to ensure that South Africa has trade representation in the rest of Africa.

I commented on the question of export trade. But to stimulate export trade alone is not sufficient. As I indicated during the budget debate, little or nothing is being done at present to stimulate the local markets. I am sure the hon. the Minister will agree that the most effective way of doing that is to boost domestic buying power, for only if you have an expanding local market can you expect to produce efficiently enough to compete in an export market. I think that has been the experience in all other exporting countries in the world. One of the most obvious ways of expanding buying power is to raise the level of wages of the workers, particularly the African workers in our case. I hope that the Minister will not try to avoid this issue by trying to pass the buck to someone else—possibly his neighbour, the Minister of Bantu Administration and Development. Sir, this is an economic issue, it is not a racial issue at all, and it is an economic common place that anything which restricts the earning power of the African workers will also restrict their buying power. As I say, it is an economic issue, and the former chairman of the Board of Trade expressed the view that that was a method, a very suitable method, of stimulating the local markets. The Federated Chamber of Industries, and in particular the Midlands Chamber of Industries, have stressed this and have asked the Government to give a lead in regard to this very necessary stimulant for the local market. If the hon. the Minister will read this morning’s issue of the Cape Times he will find that a similar plea is made by the Chamber of Commerce. Sir, there is this need for stimulating the local market. I submit that this is a suitable matter for investigation by the Board of Trade, and I hope that the Minister will give some assurance that something of that nature will be done.

There are just two other aspects that I would like to raise with the hon. the Minister. The first is what the Government’s policy is in so far as the motor industry is concerned in regard to the increase in the local content of motor vehicles. Although the proposed establishment of the Synthetic Rubber Industry at Sasol is still only in the planning stage, and has not yet reached anything further than the blue-print, the Government’s own outlook in regard to this matter has advanced considerably. In reply to a recent question asked by the hon. member for Port Elizabeth (Central) (Mr. Dodds), the Minister gave a clear statement setting out the Government’s policy. But the motor industry has taken the matter much further: they are still being left in doubt as to what the Government’s policy is in regard to this question of local content—how and on what basis it is going to be calculated. I hope that the hon. the Minister will give us some further details in this regard. Then, finally, there is this question of the cuts in tariffs arising from negotiations which have taken place between the United Kingdom and the European Common Market. In reply to a question which the hon. member for Jeppes asked some time ago, the Minister naturally took a cautious view of the matter, and said that it was something that has still to be considered and dealt with. I hope that he will now be able to give the House far more information at this stage, because it is clear from the local Press that the position is not a static one, and that negotiations are proceeding still further in other directions as well between the United Kingdom and members of the Common Market.

The criticism voiced by hon. members opposite has concerned mainly four subjects. In the first place it concerned our economic growth, which was doubted by the hon. member for Jeppes (Dr. Cronje). The second matter concerned the European Common Market and the question was asked what the attitude of the South African Government was to that organization; the third point of criticism was in respect of import control, and fourthly they discussed exports in general, and particularly our expors to the African states.

I want to deal with these four matters separately, and although one could speak at length on each of these subjects, I shall do my best to deal with them as briefly as possible. In the first place, in regard to our economic expansion, I must say that I really feel sorry every time the hon. member for Jeppes has to get up here and cast doubt on the economic development of our country in a debate like this. On such occasions the hon. member is really a tragic figure. There must be a conflict in his mind, between the economist on the one hand and the politician on the other. As an economist the hon. member must surely know what the actual position is. As a businessman serving on the boards of various companies which, as far as I know, are making progress, he must surely know what conditions are in South Africa. He must surely know of the growth we have in South Africa at the moment. As an economist he must know the economic figures and principles and methods of calculation, but as a politician he certainly has to paint a dark picture, and then economic facts and principles and yardsticks are simply thrown overboard, and the hon. member tells us that we must ignore the ordinary yardsticks of economic growth. He actually pleaded with me not to talk in this House again about capital investment and all the other things we always take as the yardsticks in regard to the economic picture. He says he knows we will do it, but I must please not do it. Because the hon. member knows that if we apply the normal barometers of economic growth, the yardsticks, which are used right throughout the world, we completely dispose of his standpoint. I, and also other members, in debates in recent years, have pointed to the great growth which has taken place in South Africa in regard to the national income, savings, investment and capital formation, in regard to consumers’ expenditure and industrial development, both in volume and in variety, and in respect of agriculture, mining, the infrastructure, exports—we used numerous yardsticks in the past and proved that there was growth in every sphere in South Africa, and even now during these most difficult times. But now the hon. member for Jeppes says, “Do not mention those things” He now wants to apply two new yardsticks to determine economic growth, the one being employment and the other consumption.

Are those not yardsticks?

I am coming to that. Let us take each of them separately. I do not deny that employment is a yardstick for assessing economic growth. I do not doubt that one should use the statistics in regard to employment as one of the yardsticks. But if one does so, one must make sure that one’s statistics are complete. The hon. member himself referred to the “lamentable state” of our statistics, but then he uses those statistics as a yardstick to prove that there is no growth in South Africa. He does not make full use of the statistics because he uses only industries and construction as yardsticks for the economic growth of South Africa. Sir, the employment in construction and in factories is not the only yardstick for the economic growth of a country. There are mining, agriculture, the fishing industry, forestry, commerce, the professions, the services rendered, the Provincial Administrations, the Public Service and numerous other activities which the hon. member conveniently leaves out of the picture. Surely the hon. member knows that in the economic growth of any nation there comes a time when industry does not employ people at such an ever-increasing rate, particularly as the result of mechanization, and that employment is mainly spread over the tertiary industries. Why does the hon. member keep quiet about that? Why does he concentrate only on that one point, employment in industry and in the construction business, and why does he keep quiet about all the other forms of employment, particularly in the tertiary activities?

The figures are not available.

The hon. member also neglected to mention that in these comparative figures mentioned by his State corporations and State construction works, as well as the statistics in regard to factories, were not included. Employment is not the only yardstick. Apart from the fact that employment in South Africa is at a comparatively high level, we must take into account that a certain amount of unemployment is caused by mechanization. We have proved that there is growth in all these spheres, but to the extent that we mechanize more there will be a greater measure of unemployment. The hon. member shakes his head, but it is true.

Does that happen to the member countries of the Common Market in Europe?

We can initiate a long debate on that point. Those countries are great producers of capital goods. There some of the unemployment resulting from mechanization is absorbed by the industries manufacturing capital goods, which is not the case here.

Another point raised by the hon. member and certain other hon. members, which is also of great interest, is that they plead for higher wages, particularly for the Bantu. Do those hon. members not know that much of the unemployment, particularly amongst the Bantu to-day, is due to the higher wages paid by certain industries? There are many factories—I know them and hon. members know them—which paid a certain amount, say R5,000 a month, in Bantu wages, and they increased their Bantu wages by, say 10 per cent. But they did not increase the sum of R5,000 by 10 per cent. They are still paying the same total amount in wages, but they employ fewer Bantu. That is also my reply to the hon. member for Port Elizabeth (South) (Mr. Plewman), that this question of increased Bantu wages is not a matter on which one can just give a reply and say that we must increase wages because we want greater purchasing power in the country. It is a very complicated matter and unless it is handled very cautiously it will cause greater unemployment in the country. I also want to point out to the hon. member for Jeppes that employment is not the only yardstick, also for another reason. We have in South Africa today a tremendous influx of Natives from outside. It is estimated that there are 1.3 million foreign workers here. That is not the normal population growth which has to be absorbed by industry, but it is abnormal in the sense that tens of thousands of Bantu are continuously crossing our borders, which of course must have its effect on employment in this country.

The hon. member also used the other yardstick of consumption. He keeps quiet about the fact that the real per capita income increased by 30 per cent during the régime of this party. He keeps quiet about the fact that between the years 1950 and 1961 the money spent on consumer goods increased in South Africa from R1,686,000,000 to R3,531,000,000, more than double. The expenditure on consumer goods was more than doubled in 11 years. The consumption of food is not a yardstick. I do not know whether I understood the hon. member correctly, but he mentioned the example here of food surpluses. I hope he did not mean it that way. He regarded the food surpluses in South Africa as proof of our economic deterioration. If that is what he meant, I want to tell him that if food surpluses are proof of economic deterioration, then America is certainly the most backward country in the world to-day, and China the country which is most highly developed economically. Food consumption is not always a yardstick. We have data showing that the Bantu, as his wages increase, does not necessarily buy more food, but that he uses his money to buy clothes and furniture, radios and other articles. On the contrary, we find that they use a large proportion of their income to-day to buy motor-cars, with the result that the Bantu in South Africa to-day own 100,000 motor-cars, which is proportionately more than the Russians do. The hon. member referred to the retail trade which has not increased, or at least not to the extent that he considered necessary. But that is not a yardstick either. The retail trade is only a partial yardstick because the public do not always spend their income in the retail trade, but save some of it, or use it for services instead of buying articles in the retail trade. As prosperity increases, a larger percentage of our income is used for services. The hon. member selected his own two yardsticks, and I think you will agree with me, Sir, that the yardsticks he selected are very doubtful ones.

No, the fact is simply this, to put it briefly: South Africa to-day stands on the threshold of new economic growth. South Africa stands poised to-day to climb to new heights in the economic sphere. That is the conclusion arrived at by businessmen and economists and by visitors from various parts of the world. We find proof of that in our increased national production, in our gold production, and in the optimistic spirit amongst our people; we find it in the gross savings and capital formation in the country, in our increased reserves, in the increase of liquidity, in the confidence the world has in us, in the new spirit of optimism one notices every day when coming into contact with businessmen in South Africa. If only the hon. member had read the Sunday Times of a few weeks ago, he would have found that it had practically a whole page about the new economic undertakings in South Africa. And what was contained in that page in the Sunday Times about new economic undertakings, impressive as it was, can be doubled and supplemented. In that regard I want to mention a few other things also. We often hear people talk about us being isolated in the economic sphere. I do not want to go into the whole matter, but in regard to isolation and the drying up of foreign capital, let me just repeat the figures I mentioned in a previous debate, that my Department, the import section, last year received 201 applications from people asking for permits for the importation of raw materials and capital goods for new industries and the expansion of industries, involving a total capital of R27,000,000, and 40 per cent of that capital was foreign capital. In the first quarter of this year there were 51 similar applications, and 60 per cent of the capital involved in the establishment of new industries consisted of foreign capital. That proves to me that the foreigner, perhaps even more than the local entrepreneur, and perhaps more than the hon. member for Jeppes, sees great possibilities in South Africa, and that they are developing the future of the country.

Another matter referred to here was the European Economic Community, and you will allow me, Sir, to pause to deal with this matter because it is of the greatest importance to South Africa. I want to give hon. members opposite the assurance that the European Common Market is regarded by the Government and by myself as a very important thing. I want to assure them that it is regarded as perhaps the most important individual development in Europe in recent times, and as one which will definitely have its effect on Europe and on the Western world. And it is not only since last year, as the hon. member suggested, but right from the time this development first started that our Government and our Department, in co-operation with other Departments, started devoting the closest attention to the E.E.C. and making a study of its principles and of its potentialities and its possible effect on South Africa. And although those matters were not always published, hon. members can take it from me that my Department made use of every possible opportunity to become aufait with the developments in regard to the E.E.C.

This European Common Market is developing very fast now. Its object is to bring about greater trade by abolishing gradually over a period, all tariffs between those countries, and applying a common tariff vis-à-vis other countries. But the E.E.C. is much more than merely a trade bloc. The E.E.C. is also an economic unit which seeks to forge links in various other economic spheres between the present six member countries and those which may still join them, in order to make it a complete economic unit. But it is more than an economic unit. Its object is also to have a political unit, in order to strengthen Europe. That is the reason why in the beginning neutral countries, like Switzerland, Austria and Sweden hesitated to associate themselves with the E. E. C. In spite of the doubts which some people have, the E.E.C. has recently made fairly fast progress. The internal tariffs were abolished faster than was originally expected, and on 1 July the reduction on industrial goods will already be 50 per cent. Even in the sphere of agriculture, which provided difficulties, a start has been made with the abolition of tariffs inter se, and an outside tariff has already been drawn up which will be the arithmetical average of all the separate tariffs of the six states.

Now the question is how the E.E.C. will affect South Africa. To put it briefly, we must accept that the E.E.C. will affect us, because the tariffs between these six countries will be abolished and goods will be able to move freely over their borders, whilst South Africa will be faced with a tariff wall in those countries, and there are certain of our products which will definitely be affected. I cannot go into all these matters to-day. I can, however, say that approximately 70 per cent of our exports to the Common Market countries will hardly be affected at all, because there will be either no tariffs or only a very low tariff against us, or because they are products which are not produced at all, or only to a very limited extent, in those countries. But what will be affected are certain of our products like fruit, jams, fish, eggs, mealies, fish meal, wines, etc. But we are also affected by the fact, as was mentioned by one of the hon. members opposite, that the African states will become associated with the Common Market, and when these African states which were dependancies of the countries which are now associated in the Common Market eventually have free access to the Common Market, it means that whilst they have free access we will be faced with a tariff wall. It will affect our competitive position vis-à-vis those African states.

But now the great question facing us to-day is the possibility of Britain joining the Common Market. We know that in the beginning Britain was hesitant, for three weeks. In the first place, because of the supra-national character of the Common Market, Britain was not prepared to abandon its sovereignty. In the second place there was a great difference between the agricultural policy of Britain and the possible agricultural policy of the Common Market countries. In the third place, and this is important, there were the Commonwealth preferences which Britain had with the Commonwealth countries, and which was contrary to the principles of the E.E.C. Now we can take it that if Britain joins it will probably be accompanied by the abandonment of the Commonwealth preferences and the Ottawa preferences. Because it concerns not only the Commonwealth preferences, but also the preferences we enjoy, no longer as a Commonwealth country, but the preferences based on the Ottawa agreements of 1932. Britain has intimated that it will try to negotiate special conditions for the Commonwealth countries. The British Prime Minister stated that he would not join it on such terms as would do “grave injury” to the Commonwealth countries. A few days ago a report was published about what Mr. Sandys said, when he remarked that if Britain had to choose between the Commonwealth and the E.E.C. it would choose the Commonwealth. From that we must infer, reading between the lines, that some means will be evolved to reconcile Commonwealth preferences with membership of the E.E.C. Now, how will it affect us if Britain joins and the Commonwealth preferences and the Ottawa Agreement have to be terminated? I cannot go into details, but I just want to say that we sold to Britain in 1961 approximately 32.9 per cent of our exports, and of this 32.9 per cent of our total exports to Britain, 44 per cent is subject to tariff preferences. If we are to lose these preferences in Britain, it will mean that the Common Market countries, which in many respects were our competitors, will have free access to Britain, that the tariff wall against them will be broken down, and that the comparatively free access we enjoyed will be complicated by a tariff wall. We will be faced with difficulties from two sides. There will be free access for our opponents and tariffs imposed against us. Certain of our products will be affected to an appreciable extent, like wine, fruit, canned fruit, vegetables, sugar, eggs and dairy products, hard-board, apple extract, ferromanganese and certain chemical products, etc. I have stated the position as briefly as possible, perhaps as unfavourably as possible, as to how South Africa will be affected if we lose our tariff preferences in Britain. But perhaps the position will not be so unfavourable.

There are certain factors that may operate in our favour. In the first place, it may be that the external tariffs of the Common Market countries will eventually be much lower than they are now, and that it will still be possible for us to sell in the Common Market, in spite of the tariffs. I believe that if our producers and manufacturers continue producing quality goods, they will be able to sell their products in other countries in spite of those tariff walls, and that we should not frighten our manufacturers and producers by telling them that it will be impossible to get into those countries because of the tariff walls which will be built around Britain and the Common Market countries. It is possible, particularly if Britain joins, that the tariff wall of the E.E.C. will be lower than it is now. The possibility also exists that South Africa may use the preferences it now enjoys in Britain on the basis of the Ottawa agreements elsewhere in another way to our advantage. There is the possibility that the seasonal differences between South Africa and Europe particularly in regard to fruit and vegetables, may operate to our benefit. There is the possibility that if the preferences are abolished there will be a reasonably long transitional period to enable us to adapt ourselves. There is also the possibility that Britain may succeed in obtaining certain concessions when it joins the Common Market for the Commonwealth countries and for a country like South Africa which entered into an agreement with Britain at Ottawa. The possibility exists that with a stronger Britain and a stronger Europe in the economic sphere, we may obtain a much larger market, even with tariffs against us, then we would have had without tariffs if Britain is weak economically.

A weak Britain?

Without criticizing, it is a fact that Britain has in recent years been struggling with its balance of payments and to maintain the standard of living of its people. That is one of the reasons why Britain wants to join the Common Market. We must ask ourselves whether it will not be better for us to trade with a stronger Britain and a stronger Europe than if they are not as economically strong as they should be.

Now, what of the future, and what should we do? Questions were asked, inter alia, by the hon. member for Parktown (Mr. Emdin) as to how South Africa can link up with the E.E.C. My reply briefly is that South Africa cannot join the E.E.C. We cannot become a member for the simple reason that we are not a European state. The second thing possible is association with the E.E.C., like the position of the African states to-day. In terms of the Rome Treaty the association of states outside Europe with the Common Market is possible in principle. But as we see the matter, it is not the policy of the E.E.C. to allow states outside Europe to be associated, except those states which are or were dependancies of the present members of the E.E.C., and that they are not in the least desirous of allowing other states to be associated with them. Then the question in our mind is also, even if we can associate, whether it will be desirable for us to accept the discipline of the E.E.C., which would mean that we would gradually have to reduce the protection of our industry and gradually freely allow the products of a strong and economically experienced and developed Europe to enter our country, and whether we can afford to do so. At the moment neither of these two courses seem possible to us. Therefore it is necessary to seek other ways of safeguarding our trade and our exports to the Common Market, whether Britain joins it or not, but even more so if Britain joins. I believe that there are possibilities for establishing some sort of relationship between South Africa and the E.E.C. which will to a certain extent compensate South Africa for what it will lose if Britain should join. Hon. members will understand it if I do not want to go into the details of this now, because it may perhaps be the basis for negotiations. I also believe that such negotiations for compensating South Africa in some way or other for what it loses, if it does lose its preferences in Britain, can and should be carried out within the framework and in the spirit of G.A.T.T. My interpretation of the spirit and the principles of this agreement is that it allows customs unions in various countries when third parties do not suffer as the result of it. My interpretation of the principles of G.A.T.T. is that if we and the Commonwealth countries lose a lot if Britain joins the Common Market, we will be entitled to some form of compensation in terms of G.A.T.T., and that it will have to be given to us. It must be realized that South Africa also plays its part in world trade, that it will make its contribution to world trade, and that it cannot be allowed that South Africa through the loss of, say, 20 per cent of its market should be put into a worse position as a partner in international trade.

I therefore want to say that I am going overseas myself within three weeks in order to initiate the negotiations. In the meantime much information has already been obtained. I have already done that. We have had close and continuous contacts through our ambassador in Brussels and our other ambassadors and by means of our trade commissioners who serve as listening posts for us, and in numerous other ways at congresses and by means of G.A.T.T. We were in close contact with the E.E.C. countries and we tried to obtain information in every possible way, so that it could not be said that we merely allowed things to develop. Within the framework of G.A.T.T. our delegations fought every year for the interests of South Africa, in so far as the Common Market is concerned. We are fairly aufait. But because the point has now been reached actually to take action, it has become necessary for me to go overseas and to discuss matters with the six member countries of the Common Market, and put our problems to them, and to see what the best is we can do for South Africa.

There has been reference to the appointment of an economist. I just want to say that in spite of what was said by hon. members opposite, an economist has already been found. I shall send the hon. member for Jeppes an invitation one of these days to go and see him off at the airport. It is hoped that he will be able to start working at the beginning of July. Due to the fact that certain formalities have to be observed, as in the case of all appointments abroad, I am sorry I cannot announce his name to-day. I hope to be able to do it within a few days. If I do so, I think hon. members will agree with me that we have succeeded in obtaining one of the outstanding persons in our country, a man who not only knows economics but also knows the Public Service of South Africa.

I want to discuss import control briefly. During the course of last year I was compelled to impose import control, and hon. members know what the circumstances were. We know that import control, and currency control which accompanied it, were responsible for our foreign reserves climbing to record heights during the past year. If there is one thing which instilled confidence in the mind of the financier and the industrialist overseas in the strength of our economy, it is the increase in our foreign reserves to this record level in a period of less than a year. If there is one thing which strengthened the confidence of the world in our economy, it is the fact that in the past year, which was one of the most difficult years South Africa has ever experienced in the economic sphere, due to boycotts, due to uncertainties, due to leaving the Commonwealth and bad propaganda made against us, our currency reserves increased to this extent. As the result of the increase in our reserves, pressure is continually being exerted on me, as the hon. member for Jeppes has also seen fit to do, either to abolish or appreciably to relax import control. I do not know whether the hon. member for Jeppes spoke on behalf of commerce or on behalf of industry or on behalf of the economy of the country. I do not know what the hon. member would tell the industrialists of this country if he makes this suggestion. He spoke about industrial development, and I wonder what the industrialists would have told him if he had gone to them with this plea that he made here to-day.

Is the object of import control then to protect industry?

I promise the hon. member that I will come to that question. The easy way of evading a question is to ask a counter question! Sir, I believe that in spite of the welcome increase in our foreign reserves, South Africa cannot yet afford to uplift import control, or even to relax it to any appreciable extent. We live in uncertain times, in which it is necessary rather to be cautious. Instead of perhaps relaxing import control and later again finding it necessary to increase it, we should be cautious, because if we do that it can result in instability in our economy, which is undesirable. I think we must spare commerce and industry that uncertainty. We must bear in mind that South Africa is a country with a great tendency to import. But we must also bear in mind that we expect to have appreciable industrial expansion starting within the next six months, and with that industrial expansion and economic activity we can expect to have greater imports of capital goods and consumer goods and raw materials. It may then be that our reserves are not enough. Whilst R369,000,000 at the present moment seems satisfactory, we must realize that we are living in difficult times. There are boycotts against us; there is the problem of the E.E.C., and I will feel safe only if our reserves increase to an appreciate level. On the other hand, there are again those who believe that we should never relax import control; in other words, there are those who allege or expect us to use import control as protection for our industries, together with the import tariff. I want to tell those persons that the application of import control is subject to certain international obligations, viz. that import control may not be used to protect industries, but may only be used as a means of restoring the balance of payments position and that it should be abolished as and when the reserves improve. South Africa, which has faithfully fulfilled its obligation in this respect, does not intend to allow itself to be tempted to exceed the limits. It is, however, obvious that import control itself happens to protect industries; it so happens that it protects industries in this country, and it is obvious that any relaxation of import control must be applied in such a way that it will not seriously disrupt the industrial structure in the country unnecessarily. It is obvious that a Government always has to retain the right to determine to what extent the imports of certain classes of goods should be limited, in order to use to the best advantage the foreign exchange at its disposal, and not to waste it on unnecessary goods and goods which can be manufactured here. In other words, it is not our idea to use import control as protection for industry per se. The customs tariffs are the obvious way of doing that. The task of the Government in this respect is to maintain the balance between these two extreme points of view, and I can assure hon. member that it is not always such an easy task to keep that balance.

The hon. members for Benoni (Mr. Ross) and Port Elizabeth (South) (Mr. Plewman) expressed certain doubts in regard to our trade with the African states. The hon. member for Benoni has possibly misinterpreted a speech I made in Johannesburg a few days ago. In spite of that misinterpretation, I just want to tell him that it is my standpoint that we are deceiving ourselves if we believe that our essential market lies in the undeveloped states of Africa. South Africa is still the workshop of Africa, in the sense that industrially we are the highest developed country in Africa, and will remain so for an appreciable time, or for ever. But to believe that the African states should be our most important market, and that we should concentrate our exports particularly on them, is a fallacy which can only be to the detriment of our economy. In the first place we know that the purchasing power of the inhabitants of the African states is comparatively low. In the second place we know that they are mostly saddled with balance of payments problems. In the third place we know that where they receive political capital from outside, the first industries they will develop will be those we have here also; they will have the same type of industries and they will be at pains to manufacture their own goods and to protect their industries, and to keep our goods out. In the fourth place, most of the African states receive loans from elsewhere, and it is usually a condition of those loans that if that money or portion of it is to be used for purchases, those purchases must be made in the country of the lender. If we hope to develop large markets there, we will not only have to go and buy there, but we will also have to lend money to those countries.

We received loans ourselves.

Nor am I so optimistic about the tremendous future development of those countries, and their tremendous future potential markets. They have not the technicians nor the capital. Hon. members surely know that there is such a thing in economics as the capital coefficient. Generally, one has to invest R8 to get R2’s development. In other words, if in Africa one wants to make possible a development for the inhabitants of R2 per annum and there are 250,000,000 of them, and you want to raise their standard of living by R250,000,000, one must invest four times that amount—one must invest R1,000,000,000 to increase the standard of living of the inhabitants of Africa by R1 per annum. Where is all that capital to come from? I am not so optimistic about the possibilities of that market in the future.

The fact remains, Mr. Chairman, that the greatest international expansion of trade takes place between highly industrialized countries. The most highly industrialized countries of the West to-day trade with each other, and that trade has expanded faster than their trade with the undeveloped countries. Therefore I say that we must devote most attention to trade, not in Africa, but with the highly developed countries which have the purchasing power, and whose purchasing power is steadily increasing. That is where our future lies. Let us have the courage to enter those markets and not to fear that our products will not sell there.

Both hon. members misunderstood me by averring that I am supposed to have said that we should relinguish that market. I never said anything of the kind. I did not say we must turn our backs on the African markets. I only said that we should not regard them as the only and most important markets. We will still continue developing those markets. I may just say that in spite of boycotts our trade with the African states last year still amounted to R148,000,000. Two years ago it was R166,000,000. In these two years it fell by R18,000,000, the greatest decrease being in respect of the Federation, not because the Federation boycotted us, but due to economic circumstances there. We therefore still have a tremendous amount of trade with the African states, but it is the task of the exporters to develop that market. It is not only the task of the Government to do that work. We do not intend appointing trade commissioners there now, as the hon. member for Port Elizabeth (South) suggested. Does he think we must go and ask those states to receive our trade commissioners whilst they are boycotting us? Would a nation’s honour allow it to do so? Do you think those countries would receive our trade commissioners?

Then hon. members aver that it is our fault that we are boycotted. The hon. member for Benoni and the hon. member for Port Elizabeth (South) said that it was all due to the political policy of the Government. If it is all this Government’s fault, why did India then boycott South Africa in 1946? The first boycott of South Africa happened under the United Party, when General Smuts was Prime Minister, and for political reasons. But what do hon. members opposite suggest should be done to stop those boycotts? The hon. member says it is our political policy which causes it, and if they are in power that will not be the position. What are those hon. members prepared to pay for those markets? What concessions are they prepared to make to get those markets? It is very easy to say now that it is due to the Government’s policy. Let us accept that. But what will they do? Will hon. members opposite comply with the demands of those states, with those political demands which really amount to interference in South Africa’s affairs, the dictation of policy to us, absolute equality, one man, one vote, and the end of the White man in South Africa? That is what they want, and that is the only thine which will satisfy them. Are those hon. members prepared to pay that price? Sir, what does it really amount to? That is the political problem of South Africa to-day; that is the economic problem of South Africa. South Africa’s economic troubles do not lie in its economic policy and its economic thinking, but our economic problems are all based on international political troubles which have an effect on our economy, and I am sure that those hon. members are just as little able to solve those political problems as we are, unless they are also prepared to sacrifice the South African nation.

The hon. the Minister, amongst other things, made one important statement this afternoon. There are various questions we still wish to ask him. I think we should deal shortly with his statement about the Common Market. He has told us that he himself is shortly leaving for Europe to look into the matter. He has told us that he has actually appointed an expert to go over there. This expert will leave in July. For the first time, Sir, he has told us fairly fully what the Government’s attitude is in regard to the European Common Market. Well, we have been pressing for some years in this House for some such statement from the Government. So far they have simply told us that they were watching events as, indeed the hon. the Minister has said this afternoon. But they have not given us any indication of what we believe to be the case, namely, that this Common Market holds the most serious implications as far as the future of our economy and trade is concerned. We never got an admission from the hon. the Minister until this afternoon. That is why I say it is an important statement. Because although it is some years too late, or later than it should have been, at any rate it is a step forward to know that our Government has at last awakened to the seriousness of the problem which confronts it in the event of the United Kingdom joining the European Common Market and throwing its weight into its development, and if a tariff wall is built round the whole Market. The hon. the Minister has told us that whilst 70 per cent of our exports—by that I take it that he means 70 per cent of our exports to the United Kingdom—would not be effected by the Common Market arrangements, because they are either duty free or else subject to a very low duty, in other words, they are raw materials required by the industries either of Britain or members of the Common Market, he does agree that as to the other 30 per cent—which mounts to a very considerable sum—we may be in very serious difficulty. He did not agree with the hon. member for Mayfair (Dr. Luttig) who earlier in the day tried to repeat the attitude which the Government has taken up until now, namely, that there was not very much to worry about. I can remember the hon. the Minister making speeches to the effect that we might even benefit by the creation of a European Common Market and that we might be better off with it than without it. I think the hon. member for Mayfair would have been wiser had he waited until his Minister bad spoken before he came into this debate. Because he also for the first time knows how his Government views this position. Knowing that I am sure he will be more careful what he says about it in the future.

Whilst it is satisfactory to have got the Government to the point of admitting there is a problem, one cannot say that the attitude of the Government through the hon. the Minister, is in the least satisfactory. Because while they claim to have been keeping a very close eye indeed on its possible effects on this country, they do not seem to have any clear idea as to what can be done to mitigate those possible effects. The hon. the Minister said that whilst there were possible damages to our economy to be faced, notably in the case of primary products or manufactured primary products, he hoped that that might be off-set by lower tariffs in the Common Market, that the tariff wall round the Common Market might be lowered, thus enabling our industrial products, such as canned goods, to get over that wall. Secondly, he hoped that as a result of the development of the Common Market Europe as a whole would be more prosperous, including the United Kingdom, and would therefore be a larger and a better market with a higher purchasing power than it is at present and that we would reap our share of the benefit of that increased prosperity. Then he said something which I did not understand and which I hope he will elaborate when he speaks next time. He said he thought that G.A.T.T. came into this question, and that under the G.A.T.T. agreements customs unions were allowed but that other countries were not allowed to suffer as the result of those customs’ unions. I do not quite understand that, because if customs’ unions are allowed it is quite clear that some countries are going to lose business as the result of it. But the Minister said he thought that if as the result of the Common Market arrangements between Britain and The Six the Ottawa Agreements and the other preferences were to go—and I wish the Minister would not talk about the Ottawa Agreements as if they were entirely individual trade treaties, because they are not; they were trade treaties, but they were trade treaties between members of the Commonwealth. It is no good saying they had nothing to do with the Commonwealth, because they had. If we had not been a member of the Commonwealth when the Ottawa Agreements were arrived at, we would not have been involved in them at all. [Interjections.] I understood the Minister to express the view that it was as the result of the Common Market agreement with Britain that the Ottawa agreements might fall away, and also the other preferences, and that in some way or other we should be entitled to some form of compensation for the loss of them. That is the point I do not understand, because I do not know who will compensate us for the loss of that trade. It may be, of course, that the Minister means that he may be able to negotiate other trade treaties to take their place, because of course he has by no means a weak hand when it comes to negotiating trade treaties. But I would like him to explain it more clearly because we are all concerned, just as he is, as to what will be done, and so far the Minister has simply told us that he hopes, if these things do come to pass, that the disastrous consequences that may face some of our agricultural industries may be averted, and he has indicated in a vague way how he thinks they may be averted, although personally I must say I cannot see much ground for hope in what he has said so far.

In regard to import control, the Minister said that he does not think we are in a position to relax it, because we live in uncertain times when anything may happen. Of course we agree that under this Government anything may happen, and therefore the Government is both to relax import control, because anything may happen and our reserves may go to pot. Perhaps the Minister could give us some idea of what he would regard as a safe margin. [Time limit.]

The hon. member for Constantia (Mr. Waterson) spoke at random and really only repeated what the Minister said, and he made no point to which I could be expected to reply. I assume that the few questions he put to the Minister will be answered by the Minister. But I have actually risen to digress somewhat from the direction the debate has taken so far, in order to make a few remarks about another aspect of the Minister’s vote, namely in regard to the position of our scientists. With reference to the urgent need for scientists and the realization in all responsible quarters that we have arrived at a stage in our development where increased importance is attached to scientific training and research, as well as with reference to what the Minister of Agricultural Technical Services said the other day when he announced increased scales as well as promotion on merit, I should like to ask the Minister whether he will give consideration to the position, and I should like to ask his views on the present salary scales and the possibilities for promotion of scientists in the C.S.I.R. as well as in all the other research bodies in his Department. I should like to make the submission that we have come to a stage where we have to realize that we have to put a premium on scientific training and research, both in basic sciences as well as in applied sciences. In the first place, we are confronted with developments in the industrial sphere which requires our scientists, particularly our engineers, physicists and chemists, to do research themselves in regard to our problems. We have also arrived at the planning of our own arms industry, and furthermore there is the planning in regard to nuclear physics, all of them things that are making great demands on our own scientists, Moreover, it is a fact too that with our industrial planning we are going to make great demands on our engineers and physicists in the future, and because that is so, we have a great backlog to make up, as in all the other Western countries, including America, where it is realized that they are very far behind and attempts are being made to train more scientists. When I say that we should put a premium on scientific training and research and knowledge, I am mindful of a few things in particular.

In the first place, I am thinking of the salary scales for scientists that ought to be increased so as to make science more attractive to more people. Secondly I think that we should put a premium on the standard of university education and that a person who is prepared to carry on to the highest training, that is to say, to go from the B.Sc. and the M.Sc. to a doctor’s degree, should be encouraged, for we do have a large number of scientists that are of great value as it is but would be of much greater value for the country if they were to carry on to the highest level of training. Thirdly, I think we should compensate our professional and scientific officers according to merit because there is a tendency for us to compare scientific achievement with achievements in other walks of life. That is why I think that merit should be judged on a different basis, and that it should fall under the direction of a board which should be established together with professional officers of the C.S.I.R. We should also realize that the availability of equipment is as important as the availability of scientists themselves. It is as important to us to put a premium on the availability of equipment and apparatus as it was to think deeply and broadly on the future of our defence, and I do hope that in that regard we shall also think deeply and broadly. I think we should be prepared to hand over a greater portion of our national income, not only for the training of people, but also in order to provide the necessary apparatus. Fifthly, I should like to say that we should put a premium on the training of scientists by giving our students an opportunity to obtain training by making more bursaries available to them, and in order to prevent students, who study with the aid of other private institutions and then are obliged first to render service to such a firm, and in the process of rendering service lose either their desire or the opportunity for further study, being lost for higher training. This practice, which is really an erosion of manpower, should be stopped. I think that if we were to make available to such a student the facilities for independent study from the beginning to have better opportunities of being absorbed by either the C.S.I.R. or other research quarters, we shall not have this loss that we cannot afford.

In a report of the S.A. Institute for Physics which appeared recently, it is clear that last year we had a shortage of 66 physicists, and that in 1964 we shall have a shortage of 95, without having regard to the extra needs that will arise in the mean time. To this I may only add that for every three mathematicians doing research outside university level to-day, there are two vacancies. At the present time there is a shortage of 40 per cent in respect of mathematicians alone, outside the universities. I should like to say at once to hon. members opposite, that they should not infer from what I have said here, that we are sending scientists out of the country for further study, and that that is why we are losing scientists. I should like to point out that since 1958 we have not had a nett loss of physicists. We lost three and got three from outside, and there is not such a great loss on that account that a point can be made of it. I should also like to say that we should get a revaluation of our school training. At the present time there is a tendency in our provincial education for our education to become broader and wider and shallower. [Time limit.]

I do not want to take the question of the Common Market any further at this stage. The Minister is going overseas to investigate the position, and I hope he will be back in time to report to this House before the end of the Session on the results of his visit, and I hope his visit will be successful. But at present he is just whistling in the dark. I hope that when he gets over there he will be able to see daylight and come back with a song in his heart to cheer us up a bit. In so far as import control is concerned, the Minister has said that he is afraid to uplift it. I would like to warn him that the longer he delays in raising it, the more difficult he will find it to do, because the pressure will continually increase on him not to uplift it. It will increase from his own officials who are adminstering import control and from those people who, whilst it may not be Government policy to use import control for protective purposes, undoubtedly use it for that purpose to start industries they might not otherwise have started. The longer you put off raising import control, the more difficult it becomes to do it, and I speak with some experience here. Personally, I would rather see import control lifted, even if some of its restrictions have to be imposed again 12 months later. I would rather see it relaxed, and then possibly tightened again, than to keep it tight indefinitely in case something might happen in future.

There are two points which have been referred to, one by the hon. member for Vereeniging (Mr. B. Coetzee) in regard to Sasol. He asked whether the Minister did not think the time had come for a second Sasol. I agree with him that the time may very well come for a further exploitation of the vast quantities of low-grade coal we have in the Transvaal and the Free State, but personally I doubt whether the time has quite arrived yet. because I do not think Sasol has been tidied up sufficiently to serve as an economic mode. We have something like R100,000,000 invested in Sasol and quite clearly it is over-capitalized. [Interjections.] The point is that as a trading concern it is hopelessly over-capitalized. The difference between a sound capital structure and what has actually been invested has given us an asset in the way of experience. I agree with that, but any future Sasol is intended not only to produce oil and petrol, but as the basis for a very wide and extensive secondary industry based on the products produced from that factory, and therefore the costing of those raw materials at an economic price is of the utmost importance. To enable Sasol to do that it is quite clear that sooner or later the whole question of the capital structure of Sasol should be examined and that some capital should be written off, and we always said that would have to be done sooner or later. I think the time is coming when that might be considered, and that it should be done before the question of a second Sasol is considered.

There is one other point on which I should like information from the Minister. We asked the Minister of External Affairs what he was doing about a consular service, but we got no reply from him. There is only R1,000 on the Estimates this year for the establishment of such a service, from which it is quite clear that we will not have such a service in the foreseeable future. It is also impossible to establish such a service at a moment’s notice. But what does the Minister contemplate in respect of the trade work which consulates are expected to do all over the world pending the appointment of an adequate number of consuls in different parts of the world? In the Minister’s own journal there are two references to this matter, one dealing with the South American states and the documentation required by Latin-American countries, and it points out that 12 out of the 19 require documentation, and it gives details of what that documentation is. There was also another one giving details of what is required by the Philippines, where there is a most complicated process for the consul in certifying documents and collecting fees for any exports from here to the Philippines. I do not know exactly what kind of documentation we require for goods imported into this country from say Japan, Britain or Germany, but I presume some kind of documentation is required by the customs department, and perhaps the Minister could tell us exactly what is required and what steps he is taking to see that those services are available to our importers and to exporters from the other countries to this country pending the establishment of an adequate consular service, which will obviously be a slow business.

I have listened to the hon. member for Constantia (Mr. Waterson) and I thought he would tell us about the economic policy of the United Party, so that the electorate may know whither we shall be going when one day they come into power, as they tell us all day. I am afraid the hon. member had the temerity to refer to matters relating to Sasol, while not being conversant with those matters. At the present time Sasol is producing 250,000 tons of products per annum, that is about 10 per cent of our local consumption of petrol, and during the past year it had a turnover of R17,917,000, and their profit after allowing for depreciation, was R2,594,678.

That gives us about between 4 and 5 per cent interest on the capital outlay. We know that possibly more capital went into Sasol than we should have liked, but experiments were conducted throughout the years. South Africa is the only country in the whole world that produces petrol from coal, and all those experimental and capital expenses nevertheless made Sasol a profitable undertaking. At the moment we have the position in South Africa that 360,000,000 gallons of petrol are imported, as well as 37,500,000 gallons of lubricating oil and 388,000,000 gallons of crude oil that is refined here and converted into petrol, lubricating oil etc. Sasol does not produce lubricating oil. Here I should like to urge the Minister very strongly that we should take active steps to have lubricating oil also produced in South Africa. I feel it is not good enough that we as the leading economic country in Africa do not produce lubricating oil from our own resources.

What is the world position to-day? We find that about half of all the energy consumed in the world is derived from shale oil and natural gas. Against that we find that in South Africa nine-tenths of the energy we use is derived from coal. We also know that the world’s resources are limited, and likewise the sources of crude oil are limited, and we also know that two-thirds of these sources are situated in the Middle East. New sources are being discovered continually, but the latest sources that have been discovered will, according to calculations, be sufficient for the world’s requirements for 25 years only. The Western world never knows when they may be cut off from those sources. Then we in South Africa may perhaps have to supply them with oil, for Africa already produces 2 per cent of the oil that has been discovered in the world. Here I do not wish only to malign Sasol as the hon. member for Constantia has done, but I should like to make a very strong plea that although it has been announced that Sasol proposes to double its output within seven years, the Minister should do so within the next year or two, if possible, and I should like to give my reasons. In order to double the output of Sasol, about R60,000,000 will be required. We know that certain work of consolidation still remains to be done to consolidate Sasol in order to let the present course of production continue smoothly, but it is no longer such a big task. While this consolidation is taking place, the first steps towards doubling the factory could already be taken. It is just the same as in the building industry. The foundation of your one house is laid, and while the walls are going up you can lay the foundation of the second house. If the production of Sasol could be doubled, it will be a very profitable undertaking. The interest you can earn on the capital outlay with this additional investment, will increase from 4½ per cent to about 10 per cent, and I should like to know from the hon. member for Constantia whether 10 per cent interest on your investment is not sufficient? We shall thereby also encourage other industries. We know that the synthetic gas used for petrol is the raw material for the artificial rubber factory, and as an artificial rubber plant at a cost of R7,000,000 is going to be established, I am afraid that Sasol might not be able, with this capacity, to produce enough raw materials for the artificial rubber plant, and still be able to produce sufficient petrol for our use. Sasol already produces 10 per cent of our petrol, but I feel it should be at least 20 per cent and more later. That is all I wish to say in that regard.

Then I should like to associate myself with the hon. member for Soutpansberg (Mr. S. P. Botha). During the recent Budget debate we saw that the Opposition devoted only four hours and seven minutes to the Education Vote, whereas they devoted nearly 16 hours to Bantu Affairs, and then they are the Party that talks about White leadership. I say they are committing a crime against the Europeans. Where were the Opposition speakers when they had to plead for White leaders under that Vote? But I should like to do so this afternoon. I should like to urge the Minister to use his influence so that we may train managerial leaders in South Africa. It is correct that we can say we have a shortage of industrial leaders and scientists, but he requires one man to give a lead in a great industry. You require one man to act as managing director of Sasol, and if we take steps to train leaders, even if enormous bursaries are to be created, and if we were to take the cream, say 20 of the best students and see to it that they receive the very best training, it will help a lot. Those are the people who have to see to it that raw materials, labour and capital are brought together and that production should continue, and that the products that are produced, are sold. If we had industrial leaders, we will not have so many undertakings and so many businesses that become insolvent and go under either. If we have the right man at the head of affairs, I should like to submit that he will see to it that he and all his various divisions have enough scientists, enough salesmen and enough buyers to establish his industry properly, and to develop it and make it a profitable industry. I hope the hon. the Minister will consider this matter very seriously.

I should like to say to the hon. member for Sunnyside (Mr. van Zyl) that I have done my best personally to produce leaders of the kind that he requires for South Africa, but they have not always turned out the way I wanted them to turn out. Some of them are sitting on that side of the House. But I have hope for the future.

Sir, I am very glad that the hon. member for Sunnyside has mentioned Sasol this afternoon. Why do we not know sufficient about Sasol? Because the whole government and control of Sasol and the financing of Sasol, which we have criticized consistently from the beginning, has been wrong. In Sasol we have invested approximately R100,000,000 over a period of about 10 years and we have not had any interest; it has not paid a dividend. What we are discussing is this, that all these utility corporations such as Sasol, Iscor and Foscor, should be accountable to this Parliament because this Parliament produces the finance to establish and conduct the affairs of these utility corporations. We have argued this for years; I have done it year in and year out. I have asked that they should be accountable to Parliament, and my suggestion was that there should be established a third Select Committee similar to the Select Committee on Public Accounts or the Select Committee on Railways, and that the Committee should examine the accounts of these companies. Sasol and the I.D.C. especially produce annual reports. The I.D.C., established and paid for by this Parliament, will not tell us how the money is invested; we do not know how the money is spent; they will not give a proper report; and we have asked consistently that that should be done. Sir, it is difficult to break new ground. One cannot repeat the old story over and over again, but I have found new allies, and I am going to quote from the palmy days of the Nationalist Party when they were in opposition. I am quoting from Hansard, Vol. 47, of the year 1944 when the Nationalist Party Opposition reached a higher peak of respectability than they have ever reached since. It was the year in which the present Minister of Finance said that a Cabinet Minister should be rather like a judge, that Cabinet Ministers should not be directors of companies. O tempora O mores! We see what is happening, with our new Press baron, the hon. the Prime Minister. Now, Sir, I am going to quote from my allies. The first is a minor critic, but he became a Cabinet Minister in due course. He was one of the brighter lights of the Nationalist Party. I am quoting from a speech by Mr. F. C. Erasmus, who after wards became a Cabinet Minister. This is what he said—(col. 1290)—

In those days it was £1,400,000; look at it today! Now I come to the greatest authority on Economic Affairs in the Nationalist Party at the time, Mr. Eric Louw, in the same debate, five columns later. This is what he said—

£17,000,000 for Iscor!—

And so say all of us! Mr. Chairman, you know what the French say, Plus ca change, plus c’est la même chose, (The more things change, the more they remain the same). They talk about £1,400,000 for the I.D.C. To-day it has its tentacles throughout industry in this country, and we do not know how the money is invested. We only hear what is happening when we hear of Amato and the money that has been lost in Amato. [Time limit.]

The hon. member who has just resumed his seat carried on here in a dramatic manner. It is quite a diversion for the House of Assembly, after such a lot of lifeless speeches as we have heard from members opposite, to see some dramatics. The hon. member always amuses me a lot; I am grateful to him for that, and that is all I am grateful to him for.

With reference to the European Common Market, and the charge made from the opposite side that our agricultural industry will suffer tremendous losses as a result of South Africa leaving the Commonwealth, I should like to quote what the Swiss Bank Corporation says in connection with the position of the Commonwealth in the European Common Market in respect of agriculture: They say this—

On that there could be no compromise.

Inside the Common Market itself, the rigid adherence to protectionists policies in agriculture is the greatest obstacle to the implementation of the Treaty of Rome. All Six still demand effectual measures safeguarding their markets against competition from cheap food grown overseas. There is no question of the admission duty-free to the Common Market of food grown anywhere outside—for example, from the Commonwealth.

As far as agriculture is concerned, the Six ardently desire that Britain should accept the treaty of Rome as it stands because this would permit an expansion forthwith of the market for their surplus foodstuffs. But the Six would have no incentive to admit Great Britain unless the import of food from the Commonwealth were curtailed. If Britain joined the Six, the Commonwealth could not count on a continuation of free access of foodstuffs to Britain.

Do you know what that means?

I know more about that than the hon. member in any event. I think that is a mean question, just as mean as the hon. member himself is.

Order! The hon. member must withdraw those words.

I withdraw. The hon. member makes one so fed-up. Hon. members opposite now and always come here without any grounds, without any arguments, only on suspicion and a lot of hollow cries, and try to sow the suspicion that we shall suffer loss as a result of our withdrawal from the Commonwealth, in the European Common Market that is to be established. I hope that these summaries of quite an impartial and expert organization will be a sufficient answer to them.

I should also like to refer to another small matter. I should like to refer to the place our industrial development should assume, parallel with and in comparison with our entire agricultural industry, and I should like to begin by saying that according to the report of UNO, 30,000,000 people are dying from starvation annually. The vast majority of the peoples in the underdeveloped countries of the world are underfed, and the population increase exceeds the increase of production to a greater extent every year. In 1961 the world population was about 3,000,000,000, and according to the calculations of demographers the population of the world will be about 6,000,000,000 in the year 2,000, that is to say, in a little less than 40 years. It is estimated that we shall have to double our production of wheat to keep pace with the population pressure, and that our production of milk, eggs and meat will have to be trebled, this is extremely important for our whole future, and what is more important, is the question we have to ask ourselves: How is population apportioned between the agricultural and industrial sectors? Come we take three examples. In Russia 42 per cent of the entire population, the labour force of the population, employed in agriculture, according to last year’s statistics, and with 42 per cent of them integrated in agriculture, Russia at the present time has to cope with serious agricultural and food problems. I notice in the newspaper just now that China, with her communistic system, is coping with colossal agricultural problems, with 42 per cent of her people integrated into agriculture. I could also mention East Germany; East Germany under communist control, which applies the same system, has equally great problems. Last year there even was a strike as a result of the shortages of food and the poor quality of the food products that were produced. Come we go to the other extreme; what is the position in the United States of America? America has 10 per cent of the population in the rural areas, and what is the position in America? There we have surpluses. There is not only sufficient food, but there are surpluses also, and this problem of surpluses is causing America a tremendous headache. In America we have the position that one farmer produces enough food for 24 people. What is the position in Britain? In Britain 4 per cent of the total labour force is integrated into agriculture, and what is the position there? In spite of that, Britain to-day is one of the greatest importers of foodstuffs in the world, although she has stepped up her agricultural production of foodstuffs by mechanization by about 70 per cent during the past decade. Mr. Speaker, it may perhaps be said that we should follow the system in America, that we should concentrate on industrial development and that we should leave the production of foodstuffs to a few big ones; that we should eliminate the small man, that we should eliminate the poorer farmer; that those who have the capital and the means of production available should produce the food. Will that give us the solution? Has it brought a solution to America? I do not think that it will solve our problem of surpluses, our problem of vulnerability, our problem of disproportion between industrial population and agricultural population. We shall have to be very careful. Overloading in our industrial sector brings us many problems, and I should like to mention some of them. In the first place it causes social problems; it causes great vulnerability. Industrial development of a country is very vulnerable if that industrial development is not supported by a stable agricultural population. But our industrial sector also is very sensitive, as we see on the stock market every day. But a disproportion and too much concentration in the industrial sector also produce great political instability and uncertainty as we see every day. We say that no sound economy and no stable economic structure can ever be built on a basis of disproportion between the agricultural sector and the industrial sector. The problems of the underdeveloped countries and those of the well developed countries in respect of our agriculture, are equally great at the present time. The underdeveloped countries are confonted with a shortage; the over-developed or well developed countries have to cope with a tremendous surplus; both have enormous problems. Here we have one of the problems that we in South Africa will have to face very clearly with a view to the future, and that is namely, in the same way as in agriculture the elimination of the small man may involve danger, in the same way as it contributes to greater vulnerability, so also the elimination of the small man in our commercial and business sector is dangerous; it contributes to greater instability and greater vulnerability. [Time limit.]

As we are discussing the question of overseas markets, I should like to approach it from another angle, and that is the establishment of more trade envoys in foreign countries, but not so much, as one of our members here has urged, envoys on the continent of Africa. Before I begin with that, I should like to congratulate the hon. the Minister of Economic Affairs, and tell him that we are very grateful that he, in dealing with overseas markets and with the economic conditions in the country, spoke so candidly that it is no longer necessary for us to quarrel over the floor of the House here as to whether or not we snail suffer loss if England joins the Euromarket. Like the rest of us, he appreciates that it involves dangers and problems for us. He did not say what the dangers are. The hon. the Minister here referred to percentages. He said that annually England takes about 30 to 32 per cent of our exports. I now wish to mention the figures, so that we may have a clear picture. Of the R950,000,000 of exports last year, England took R320,000,000, That is what 30 per cent means. But just to make a comparison, come we go a little further. Our next most important purchaser of our exports is the Federation of Rhodesia. They took 13.8 per cent of our exports, or R111,000,000. Do hon. members on both sides of the House realize that nearly 50 per cent of our total exports go to the United Kingdom and to the Federation of Rhodesia; and both countries hold problems for us in so far as there is not only a possibility, but the probability, that England is going to join the Euro market. What might happen is that the Federation may disintegrate or break up, and if Northern Rhodesia and the other State of the Federation are not disposed to love us more than the other African states, we may very well lose that market also. The hon. the Minister says that 70 per cent of our exports are not as much in jeopardy if England were to join the Euro market as the other 30 per cent. An economic survey of what the countries of the Euro market produce and of the potential of their production, as against what they may take from this country, amounts to a ratio of nearly 50-50, but I shall accept the Minister’s figure that 30 per cent of our exports to the Euro market are in jeopardy and that we may have to seek new markets for it. What is 30 per cent of this market? It amounts to a sum of more than R100,000,000 worth of commodities for which we shall have to find other markets. Where? Japan took 3.4 per cent of our exports last year, which represents R51,000,000 worth of goods. The United States of America took 6.8 per cent, or R77,000,000 worth of goods. The hon. the Minister was very candid. He asked what we were going to do about the matter? Can we become a member of the Euro market? But of course we cannot become a member. The Minister also referred to the tariff protection the products of this country are enjoying, which they would otherwise not enjoy if South Africa becomes a member of the Common Market, because the elimination of all tariffs is one of the objects of the Common Market. That is not all; the subsidization of our agricultural products to the extent to which they are being subsidized at the present time is another thing that should worry us. We are not a European country; we cannot in the normal course of things join the Euro market. And then there is the question of an associated country. Here I really think the hon. the Minister indulged in a little bit of political contorting, of which he accused the hon. member for Jeppe (Dr. Cronje) when he said that we might be able to enjoy the same facilities that Canada, Australia and New Zealand are enjoying.

The hon. member here on my left asks “Why not?” If the hon. member thinks that at this stage England loves us as much as she loves the Commonwealth countries …

England does love us a lot.

Yes, England does love us a lot. My submission is that we will possibly not be able to enjoy the facilities that other Commonwealth countries may enjoy. One of these days a Prime Minister’s conference is to be held, a conference we shall not be able to attend because we are not a member of the Commonwealth. If we could have had a voice there, the Minister might have been able to tell us what will happen in the nead future, but we shall not be a conferring party. We are thankful for the economist the Minister wants to send over. We know that if he sends one, it will be a good one. If he could attend that conference and could exert pressure that we should get the same facilities—and after all it will not be the same facilities as those members of Euro market will enjoy; it will be lesser facilities than those that may be granted to members of the Commonwealth. In view of the fact that we are faced with the problem of finding export markets for goods to the value of R100,000,000 to R150,000,000 and in view of the fact that our surpluses will become greater as our industries expand. I should like to urge the hon. the Minister for greater trade representation overseas. I have already done so on previous occasions, on the many occasions when I had returned and found in foreign countries that we had no trade commissioner or trade representative for instance in a country such as Brazil that wishes to buy wool from us. The hon. the Minister has referred to that on more than one occasion. I should like to begin in the Latin American countries. The Minister knows the position there as well as I do. Neither in Argentina, nor in Uruquay, nor in Brazil nor in Chile have we any trade representative, and the Minister and his Department know as well as I do that in Argentina and in Uruquay particularly there is a wonderful market for our fruit, our wines and canned products, especially canned fruit, and dried fruit.

New markets?

If the hon. member will make less noise, he will be able to listen better. There is a wonderful market for our wines especially, for that is something they do not produce at all. Now I am not thinking of Chile so much, but in the case of Argentina and Uruquay and Brazil, we ought to establish trade representation there. I am not going to say much about Europe, but we are not represented in the Scandinavian countries either. [Time limit.]

I want to refer just very briefly to our very important and popular lobster industry, an industry which at present has an annual turnover of nearly R7,500,000. In the early years of the existence of this industry the main emphasis was placed on the canned product, but in recent years, as time has gone on, the emphasis has shifted more and more to frozen lobster tails. In 1940 the then Government placed on the Statute Book a short Act, the Rock Lobster Export Act of that year, which placed this whole industry under control and granted a certain measure of protection to the industry. Six years later, in 1946, the first export permit was granted under this Act, and since 1946 these export quotas have become the cornerstone of the whole of the lobster industry. It is a remarkable fact. Mr. Chairman, that in 15 successive years, as far as I have been able to ascertain, only four new quotas were granted to this industry. It was necessary to give complete protection to this industry as a whole, and I do not think that the policy that was followed was wrong. But in the course of the years a sort of middleman also entered this industry; I refer to those persons who started supplying the export quota-holders and who also invested money in the industry. They incurred expense in the interests of this industry, and I feel that they also have a strong claim to some sort of a quota. I want to ask the hon. the Minister whether it is not possible for us to think of a formula which will be more just to both the existing quota-holders and the so-called middleman. On the one hand I want to urge that the existing quota-holders should be given a greater measure of permanency as far as their quotas are concerned. The fact of the matter is that the quotas which are granted to those people, who have also made great investments in this industry, are only granted for a year. In other words, this industry runs a very great risk. I was wondering whether it was not possible to give the existing quota-holders greater continuity or permanency. What I have in mind is that perhaps quotas can be granted to the existing quota-holders for five or ten years. And then I wonder whether the existing quota-holders will not be prepared, if greater permanency is granted to the industry, to relinquish some portion of their existing quota so that a quota can also be granted to the so-called middleman? The fact of the matter is that both groups, those persons who supply the existing quota-holders as well as the existing quota-holders, have made big investments in this industry. In my constituency there are communities which have come into being mainly as the result of the development of this industry, and I think we have reached a stage now where we shall have to think of some formula with a view to bringing about greater permanency, greater continuity, as far as this industry is concerned.

There is just one further point that I want to touch upon. I notice that provision is made in the Estimates for a certain amount for the opening of the Berg River mouth. I want to tell the hon. the Minister that there is great rejoicing in that area over this work which is to be tackled in the future. But the experienced fishermen, if I may call them that, are wondering whether the question should not be considered at this stage of establishing a fishing harbour or some sort of shelter in that vicinity. When we look at the future of the whole of the fishing industry, the fact of the matter is that as far as we can see ahead, much bigger boats will be used in the future, and the experienced fishermen in the vicinity of the Berg River mouth have some doubt as to whether the development, the opening, of the Berg River mouth will make it possible for these big boats to be housed there. I want to ask the hon. the Minister whether it’s not possible, before a start is made with the opening of this river mouth, to cause investigations to be instituted into the possibility of a shelter or a fishing harbour in the vicinity of the Berg River mouth.

The hon. member who has just sat down and other members on the other side of the House have spoken this afternoon on very many points concerning our economy, and I listened very carefully, but I have not yet heard one hon. member mentioning anything in regard to our present trade with Japan. Mr. Chairman, in gauging this trade with Japan, I would like to ask the hon. the Minister whether he has considered the full implications as to whether Japan has the full means to honour payments for all goods received. Japan, we know very well, is a crowded island with very few raw materials, and I am quoting from the current edition of the New York Herald-Tribune which says that Japan has 740 mines and that according to statistics most of these mines are on a small to medium scale, which is why Japan has to import much of her minerals. In order to earn the foreign exchange with which to pay for these much-needed imports, Japan has to export, and in order to export her pattern of export is much like that of other countries. Japan applying its skill to imported material, exports the finished product to other countries in the form of radios, transistors, electronic equipment and in a growing proportion cameras and instruments. Now Japan’s main supply areas are in the first place North America, from where Japan gets some of its materials and a large percentage of its machinery and capital equipment, and in the second place, East Asia, which supplies food and raw material to Japan. But Japan’s main export areas are East Asia and the U.S.A., and each takes one-third of its exports. Now on a small scale Japan does export, about 10 per cent, to Western Europe, and it is possible that with the development of the Common Market the percentage may possibly increase, and trade experts think to-day that the E.E.C. may increase its purchases of Japanese goods. But the point is that the current edition of this paper from which I am quoting says “That Japan’s foreign trade picture is not a healthy one It puts here the point that Japan has to import so much that it may face foreign exchange difficulties in the near future. This is a very important point which I would like the hon. the Minister to consider and to give us his answer on, because if the Japanese are placing very large orders in South Africa for much of our minerals and steel, then when it comes to payment, is the hon. the Minister quite sure that Japan will have sufficient foreign exchange to pay South Africa in cash, and not in goods? Or will Japan offer payment partly in goods and kind? Here I am thinking of the industries of South Africa themselves. What assurance have we that the Japanese will pay in cash?, and will not pay partly in cash and partly in goods. Because it is all very well for such industries as Iscor to sell steel at the cost of Japanese competition with South African industrial products, and there would then be the hazard that we might have difficulties with our own industries here in South Africa itself. I would like to suggest to the hon. the Minister that he should give this House full details of the type of trade agreement that we do have with Japan and that he should tell us what guarantees he can give us that payments will be in cash and not in goods, or partly in goods. I note from the current March 1962 edition of the Economic News Letter that is issued with the “S.A. Digest of Affairs” that our trade with Japan is such that our exports to Japan are R51,200,000 and Japanese exports to South Africa amount to R35,250,000. This leaves a favourable balance to South Africa’s credit. But have we the assurance that this trade balance will be paid for in cash? I would like the hon. the Minister to give us some information on that point, as to whether we are assured of a completely safe future in our present trade with Japan vis-á-vis our own industries?

The hon. member who has just sat down will not expect me to reply to the particular questions which she has asked here, and I do not propose to reply to them.

Last Wednesday evening at the export convention the hon. the Prime Minister laid down eight propositions for the developing of a sound economy in South Africa. I want to take one of those propositions here this afternoon as a yardstick in connection with one of our industries, namely the fertilizer industry. He declared that South Africa’s good name would be harmed by exporting products of a low quality. The immediate reply to this will be that we do not export fertilizers and that we will probably not export fertilizers in the foreseeable future either. But the point I want to make is that this proposition ought to apply not only in respect of export goods but also in respect of goods which are to be sold in the domestic market; this yeardstick should apply equally to our domestic market. Surely the fact that goods are not exported is no reason why the internal consumer should be sold inferior goods, and if a domestic industry enjoys protection because it is a domestic industry, it should not be at liberty to manufacture goods of an inferior quality.

I made the submission in the debate under the Agricultural Technical Services Vote that we were applying the wrong fertilizers to our arable land because those fertilizers have the effect of acidifying our arable land, 80 per cent of which is already sour. I pointed out that we were applying 1,000,000 tons of acidific fertilizer annually to our soil, namely superphosphate and mixtures which are being manufactured according to out-of-date methods. I pointed out that overseas the nitrophosphates and the complex fertilizers had captured the whole of the overseas market, particularly in America and Japan and in Western Europe. According to the report of the Committee which inquired into the fertilizer industry R110,000,000 has been invested in the fertilizer industry. This does not include Foscor’s capital because Foscor is a developmental company. The greatest portion of this capital of R110,000,000 which has been invested in the fertilizer industry in South Africa has been invested in plant which is intended for the manufacture of superphosphate and various mixtures. I regard this investment as an investment in out-of-date plant measured by the overseas standards where nitrophosphates and carbonitric mixtures have completely captured the market. Even the much-vaunted Urea plant at Modderfontein which cost R20,000,000 is already out-of-date, in my opinion, because agronomists agree that direct application of urea has only a limited value in agriculture. It is clear therefore that 80 per cent of our investments in the fertilizer industry represent investments in out-of-date plant and out-of-date manufacturing methods. The fertilizer industry is in the hands of two big manufacturers, namely African Explosives and Fisons and there are 11 so-called “dry mixers”. According to this report 87 per cent of the fertilizer trade is in the hands of only three companies. Paragraph 259 of the report mentions that fact. It has always been my submission that there is a monopoly in the fertilizer industry. But this commission which has now brought its report has found a new fine-sounding name for it, namely “oligopoly”. The common name for it remains “monopoly”, however. Mr. Chairman, it would be a sad day for South Africa if the State had to go so far as to protect big monopolies under the pretext that it was protecting domestic industries. It seems to me from this report as though the Committee of inquiry into the fertilizer industry fell for the representations of the big companies that the fertilizer industry must be organized on a cartel system. They actually had the audacity to submit the proposal to the Committee that a cartel should be established to control the whole of the fertilizer industry in South Africa. It looks as though that argument impressed the Committee, because in paragraph 286 of the report the Committee says—

Secondly, the attitude is adopted in the report that rock-phosphate can be treated in no other way than by means of sulphuric acid for the manufacture of superphosphate; they do not take into account at all the newer developments of nitrophosphates and complex fertilizers. In this connection I want to ask the hon. the Minister whether there is really any truth in the allegation that the fertilizer industry is to be rationalized by monopolizing the raw materials of Foscor for a iso-called consortium of manufacturers at Phalaborwa and whether the raw materials of Sasol are similarly to be monopolized for a so-called consortium of manufacturers at Sasolburg. I want to issue a warning against any such step, because there are various objections to it. In the first place it will mean the exclusion of the new development with its new techniques and of new products which are to-day largely accepted overseas as the best fertilizer products. Furthermore, it will mean the retention of out-of-date plant with out-of-date techniques and that we shall be saddled with out-of-date products. Furthermore, from the point of view of the agronomist, it will mean the ever-increasing application of wrong kinds of fertilizer to our arable land. Thirdly, it will mean that South Africa’s fertilizer products, if our requirements are to be met fully by the products which are being made to-day, will be of such an inferior quality that it will not be possible to export a single bag of it in the future, because there is no longer a demand overseas for superphosphates. The demand overseas is tor nitrophosphate and carbonitric mixtures for fertilizing purposes. If we carry on with the existing plant and the products which are being supplied at present, we shall never be able to export a single bag, because there will be no market for it abroad. Fourthly, the position with regard to these carbonitric mixtures and the other new types of fertilizer is that there is a great future for Sasol in this connection because Sasol is able to supply the raw material. [Time limit.]

I want first of all to thank the hon. the Minister for the information he has given us this afternoon on the European Common Market, and I now want to deal with another aspect of our economic life which concerns everybody in this country to-day. That is the speech made by the hon. the Minister, to which reference already had been made, at the banquet of the Chambers of Industries towards the end of last year. In that speech the hon. the Minister said—

The hon. Minister went on to say that the Government itself was involved in this planning and that he had instructed the department to determine carefully the steps which should be taken by it in an effort to achieve these objectives.

Mr. Chairman, we all agree with the sentiments expressed by the hon. the Minister in the speech he made, but what we are concerned about is not the sentiments but the implementation. When one talks about a five-year plan, there are certain ingredients which are necessary before one can transfer speech into action. These ingredients I would suggest are firstly basic research into the actual operation of the economy and from such research to develop basic theories and principles; secondly, to forecast the effects of the application of these theories and principles under a given set of circumstances and to indicate desireable controls. and thirdly, the actual plan to implement the findings.

Another matter that arises from this is the question of the missions that we sent overseas, because in a five-year plan—and I accept what the hon. the Minister said that we don’t consider such a five-year plan to be based on the communistic basis—all these facets have to be brought together. That is why export conventions are being held. For we reach a stage where the concept of all these things is, as someone said this morning, “export or die”, or what the Americans now call “trade or fade”. It seems to me, Mr. Chairman, that a start must be made by the Department of the hon. the Minister. If one reads the report of the trade missions that went overseas, one thing is abundantly clear—that is the only thing I have time to deal with—namely that our commercial service outside the Union is poor. The hon. Minister has dealt with the question in relation to the rest of Africa and I want to touch on it in relation to Europe. If you read the reports of those trade missions, you will find in practically every report, in respect of every country, that the recommendation is made that our trade representation must be stiffened. I just take a few at random. There is one on North and South America, page 14, paragraph (5)—

And then they say that the same applies to other South American countries. There is another reference on page 35 of the same report—

And so on and so forth. We would like to hear from the hon. Minister what steps are being taken to implement the recommendations of these commissions in regard to our trade representation, and perhaps the hon. the Minister could enlarge on some other items such as shipping, trade agreements, and so on.

I move—

Agreed to.

House Resumed:

Progress reported and leave asked to sit again.

Mr. Speaker, I should like to move as an unopposed motion—

This House further resolves that its sincere sympathy be conveyed to the relatives of the deceased in their bereavement.

Mr. Speaker, after this motion I wish to move that the House adjourn as a mark of respect for the passing of a person who for many long years was a member of this House. Although he is not a member of the House at the moment, he does deserve to be remembered by those of us who knew him, in this manner.

I should like to give a few particulars of his career, but it is quite beyond one’s ability, in the few moments at our disposal to do justice to such a colourful career. The person to whom we are now paying tribute, has had a long life, a long life of service at many places and in many ways. He himself was a colourful personality. One can hardly do justice to such a course of life in a brief sketch of his career. The fact is that from 8 February 1921 to 30 April 1929, that is to say for a period of eight years, two months and 21 days, he was a member of this House of Assembly in the first instance. Subsequently again from 14 June 1943 to 10 March 1958, again 14 years, eight months and 27 days—nearly 23 years altogether. For a period of four years, nine months and a few days he also was Deputy-Chairman of Committees, namely from 28 July 1924 to 30 April 1929. That indicates the duration of his parliamentary service.

But of course his public life started much earlier. After being a war correspondent in the war of 1899-1902, he became a member of the Volksraad of the First Parliament of the Orange River Colony. He served in that capacity from 1907 until 1909. In 1920 he was an M.P.C. there also. Furthermore he was in the course of his life concerned in many other undertakings, but he was nevertheless concerned particularly in politics, not only as a member of Parliament but also as a newspaper personality. He was a newspaper and parliamentary reporter, newspaper editor and even the proprietor of a newspaper, and later also a writer largely of reminiscences of a rich life.

He made two proposals for which he is known, inter alia, and about which he felt profoundly satisfied. That also connected his life-story with the history of South Africa. He proposed the motion which was adopted by Parliament in 1925, whereby His Majesty the King was requested not to award titles to South Africans any longer; and in 1957, more than 25 years later, he introduced the Flags Amendment Bill which provided for only one flag for South Africa.

Mr. Speaker, the memory of Mr. Barlow will remain with us for a long time. He was a veteran of this Parliament. I think I am justified in saying that he was one of the grand old men of this Parliament. During a long career he always expressed his views forcibly, although very often also with great humour. He was the supporter and the opponent of most of us at one time or another. He was a law unto himself as all know. He had strong belief’s and stood for them whether he hurt friend or foe. He did that because of the strength of his convictions and his desire to serve in his own way the South Africa he loved so well. Whatever one might say of him as an opponent or as a supporter, or of the ideals he stood for, there is one fact that no person can possibly deny and that is that this gentleman, this member of Parliament for so long, believed wholeheartedly in South Africa, and its future. To him this was not only his own country but a country for which all must sacrifice everything they have. His was a true love for South Africa until his death. Only a few days ago when I had the opportunity of speaking to him for a few minutes, I again gathered the impression how deeply, even at his ripe old age, he was interested in all that was happening, and how great his ideals for South Africa were also at this stage and how full of confidence he was in the future of our country. He was a man who loved South Africa deeply and who served her well.

We on this side of the House would like to associate ourselves with the kindly words which have fallen from the lips of the Prime Minister concerning the late Mr. Arthur Barlow. I think the hon. the Prime Minister was correct when he said that one time or another Mr. Barlow had been the supporter and political opponent of most of us. I think there must be few political associations in South Africa with which he did not cross swords at one time or another in a very long and interesting career. I think we can say this, Sir, that he sometimes angered those with whom he had ceased to associate. But I do not think that he ever forfeited their friendship or their affection especially those who had learnt to know him.

I think that many of his characteristics endeared him very particularly to all who knew him. I refer particularly to his generosity, particularly his generosity to his opponents. I think I must be one of many younger members in this House who have been encouraged from time to time by Mr. Barlow, even when we did not see eye to eye on big questions of the day. I think that another of his characteristics was his concern at all times for the poor, the weak, the under-dog and the unfortunate. He always sponsored their cause with tremendous zeal and enthusiasm and sometimes with surprising results. There was a third characteristic I would like to mention and that was his very great respect for the institution of Parliament and the traditions of Parliament. At all times, Sir, he was jealous of the rights of the private member. I think all those who knew him will remember his taking odd points of order from time to time that no one has ever thought of, and once a year coming in and solemnly sitting here with his hat on his head in order to exercise the right of a private member to do just that to ensure that that privilege should not be lost.

I think that one can say that his concern for the weak was associated with his affection for children. Those of us who knew him knew of his great affection for his own grand-children. I think that affection was great enough to embrace all children, all young people. I think there must be many South African children who have found great pleasure in the delightful stories which he told and which have been committed to book form for posterity as in some way a reminder, a memory, of a man who had had a most colourful career in South Africa and stood for some of the best in our public life.

The time has come, Sir, when the assertire voide, when the sharp pen of Arthur Barlow is quiet. But, Sir, I think we will all remember him. He brought a colour and a stimulus into our lives. He saved many of us from smugness and from complacency by his knack of unearthing cant and pompousness. I think if there is one thing for which we will remember him it is his genuineness and determination to go down to the bone in respect of any matter with which he was concerned.

I think, Sir, that it is fitting that we should pay tribute to him, although he is no longer a member of this House, for what he has meant to the public life in South Africa over a very long period. I second.

Mr. Speaker, on behalf of my colleagues I wish to associate myself with the remarks which have been made.

Motion agreed to unanimously, all the members standing.

I move, as an unopposed motion—

I second.

Agreed to.