CHILE

United States trade with Chile in 1938 declined 25 percent in value after having improved steadily from 1933 to 1937. The decline was due entirely to a 40-percent reduction in our purchases from Chile, as United States shipments to that country increased 2.5 percent in value as compared with 1937. United States merchandise exports to Chile amounted to $24,603,000 in 1938, while imports of Chilean merchandise were $28,268,000.

In addition to merchandise imports, the United States received gold from Chile valued at $8,414,000 and silver valued at $696,000, making a total of $37,378,000 for all Chilean products imported into the United States last year. The export of gold by Chile represents, as does that of silver and copper, the output of important domestic

extractive industries.

MILLIONS OF DOLLARS (Logarithmic Scale)

200

100

80

70

60

50

40

GENERAL IMPORTS

30

20

| 1901-1905 | 1906-1910| 1911-1915 | 1916-1920 1921-1925 | 1926-1930|1931-1935 | 1936-19401

Figure 10.-Trade of the United States With Chile.

0.0.9141

The decline in imports from Chile during 1938 was due in part to changed industrial conditions in the United States, but the drop in world copper prices and the international restrictions which curtailed the production of that metal in Chile were also important influences. During 1937 industrial demands in the world were such as to lead to greatly increased United States imports of copper (mainly for refining and reexport), and the United States market absorbed increased amounts of nitrate, crude iodine, and iron ore, together with such minor products as beans, wool, and forage feeds. The value of merchandise imports from Chile in 1937 was four-fifths above the value in 1936; and notwithstanding last year's decline, the 1938 total was still above that of 1936. As in United States total imports, midyear of 1938 marked the low point in imports from Chile; thereafter the trade showed improvement.

Although the past year was not an entirely satisfactory one for Chile, its total imports as well as its imports from the United States were sustained through the exchange available as a result of the relatively high ratio of exports to imports in 1937. With the increase in

Chilean imports and the decline in exports in 1938, an acute shortage of sterling and dollar exchange developed during the year.

Among the various products exported by the United States to Chile, machinery and vehicles continued to be the most important group in 1938. Exports in this category amounted to $8,909,000, or 36 percent of the total exports, as against $8,289,000 and 34.5 percent in 1937. Automobiles, radio equipment and apparatus, and construction and conveying machinery were the principal items in this group which were exported in increased value. The mining and quarrying machinery exports were 18 percent smaller in value than in 1937. In the textile exports there were increases in 1938 in quantity and value of raw cotton, cotton yarns, and osnaburgs. The United States regained a large part of the osnaburg trade lost to Japan in 1937. The osnaburg exports, however, did not reach the high level of the twenties, since Chile is now manufacturing considerable quantities of cotton fabrics. Exports of raw cotton to Chile in 1938 established a new high record of 12,141 bales.

There was also a marked increase in exports of milled rice in 1938 as a result of the shortage in the Chilean crop.

A number of the commodity exports which showed marked increases in 1937 decreased in 1938. These included gas oil and fuel oil, rough Douglas-fir lumber, automobile tires and other rubber manufactures, and various iron and steel products, all of which rank among the leading exports to Chile.

Table 13.-Principal Commodities in Trade of the United States With Chile NOTE. Data for individual export items include only United States products. Import commodities are "general imports" in 1929 and 1932 and "imports for consumption" in 1937 and 1938.

Table 13.-Principal Commodities in Trade of the United States With Chile

Continued

1 Figures for 1929 and 1932 have not been adjusted for minor transfers in classifications of later years. 2 Less than 500.

COLOMBIA

The United States has been for many years the principal foreign market for Colombian products. This country took 59 percent of the total exports of Colombia in 1938 and furnished approximately half of Colombia's total imports. The proportion of United States merchandise in Colombia's total imports has risen to one-half from approximately 41 percent in 1936, the year in which the trade agreement between the United States and Colombia became effective. Germany's share in Colombia's imports has also increased during the same period, while the United Kingdom's share has declined and that of Japan has remained small.

The trade agreement, as well as other economic factors which affected the business situation in each country, contributed to the expansion in the trade during 1938. During the first 6 months of 1938 Colombia experienced a business recession attributable largely to the drop in coffee prices which followed Brazil's relaxation of coffee

control at the close of 1937. The increased consumption of coffee abroad, however, and a sustained advance in the prices for this commodity during the latter half of the year, together with an influx of new funds for the development of petroleum and gold concessions, contributed to an expanded commercial movement which more than offset the decline of the earlier months. Work on many new public projects was initiated during the year, and others that had been under construction were carried forward to completion. Production and exportation of coffee and petroleum, Colombia's principal export commodities, exceeded during 1938 the record attained during the previous year, and the output of gold, the third product in importance, was raised to a new all-time record.

The effects of the more liberal petroleum law enacted at the close of 1936 became more pronounced during 1938 as new companies

1,764 24

80

70

1

1901-1905 1906-1910 1911-1915 | 1916-1920| 1921-1925 1926-1930 1931-1935 | 1936-1940||

Figure 11.-Trade of the United States With Colombia.

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actively developed their holdings. During August two new companies made preparations to start drilling; and the intensification of drilling operations on ground already under development and increased pipe-line construction imparted a noticeable stimulus to business. This development is reflected in the expanded exports of United States well and refinery machinery and of casing and oil-line pipe to Colombia during 1938.

There was a shortage of foreign exchange in Colombia during the first half of the year as a result of decreased returns from coffee exports. However, beginning in July the situation improved; and as the year closed, exchange was readily available.

Notwithstanding the recession in Colombian trade during the opening months of the year, total United States exports to Colombia during 1938, amounting to $40,862,000, increased 4.2 percent in value over 1937 results. This figure, the highest attained since 1929, represents an increase of approximately 90 percent as compared with the total in the last year (1935) prior to the agreement. The increase of exports to Colombia during the past year over the preceding year was almost totally in the classification of finished manufactures.

FOREIGN TRADE OF THE UNITED STATES IN 1938

Automobiles, including parts and accessories, the largest single item in our shipments to that country, amounted to $4,361,000, as compared with exports of this item valued at $4,035,000 to Colombia during 1937. An increase of over $3,000,000 was registered in shipments of well and refinery machinery, casing, and oil-line pipe. Decreases were shown for exports of textile machinery, mining and quarrying machinery, construction machinery, and steel plates and sheets.

United States exports of raw cotton and of cotton yarn to Colombia again increased in 1938, but exports of cotton fabrics decreased. Colombia's textile industry is gradually supplying a larger proportion of the fabrics consumed in Colombia, and the Government is encouraging the industry through the regulation of imports. United States exports of cotton cloth dropped off from 16,659,000 square yards in 1937 to 14,176,000 square yards in 1938, although shipments showed some improvement at the end of the year. Exports of silk hosiery increased in quantity and value in 1938.

The United States took nearly 80 percent of Colombia's total coffee exports, most of the gold output, and the major proportion of the exports of bananas, the second most important agricultural export. While United States imports of Colombian coffee during the first half of 1938 were only slightly larger than in the corresponding period of the previous year, the expansion of purchases during the latter half of 1938 advanced the yearly total above the record established in 1937. The unit value and the total valuation of our coffee imports averaged somewhat lower in 1938 than in 1937. However, the price of Colombian coffee increased during the year from 9.7 cents per pound in April to 11.1 cents per pound in December.

United States imports of platinum continued to decline as Colombian production fell off; Germany took a larger share of the production of this metal in 1939. was shipped to Curacao and Canada for refining. The bulk of Colombia's petroleum production

The United States for some years has been purchasing large quantities of Colombia's output of gold. Imports of gold bullion and bars, which are not included in the merchandise figures shown in table 14, amounted to $10,557,000 in 1938,. as compared with $18,397,000 in 1937 and with $11,910,000 in 1936.

Table 14.-Principal Commodities in Trade of the United States With Colombia NOTE. Data for individual export items include only United States products. Import commodities are "general imports" in 1929 and 1932 and "imports for consumption" in 1937 and 1938.