THE international trade of the world in 1913, adding imports and exports, amounted to 37,900 millions of dollars. In the preceding generation the world's trade had been growing constantly and fairly steadily, at a rate of increase of about 3.3 percent a year. If this rate had been maintained during the period 1913 to 1924 the total trade of the world in the latter year would have amounted (measured by the same standard, the dollar of 1913) to 54,000 millions. Measured by this standard its amount was actually 37,070 millions. International commerce had not yet recovered in 1924[i] its pre-war volume. It fell below the figure which might have been anticipated, had normal growth continued, by some 17,000 millions of dollars.

Figures such as these are of course perfectly incomprehensible to the ordinary person, as much so as the figures of light-years which astronomers use to denote the distance of the fixed stars. Figures expressed in gold units are not only difficult to comprehend, by reason of their size; they are apt to mislead, by reason of the change in the purchasing power of gold. The dollar of 1924 was very far from equal to the dollar of 1913. In the comparison just made allowance has been made for the depreciation of gold, but it would be tedious and difficult to qualify the figures of value by constant reference to the changes in the price level. I shall therefore avoid so far as possible the use of absolute figures, and discuss the changes in commerce by reference to the relative shares which different continents and countries had in the total at different times.

Approaching the subject in this way, the figures of Table I show how the war affected the commerce of the different parts of the world. Remembering that the volume of trade was about the same in 1913 and in 1924, it is apparent that the commerce of the African continent was practically stationary. Slight gains were made by Oceania and by Central and South America (including Mexico and the Caribbean islands); marked gains, in spite or because of the war, by North America and by Asia. Europe alone, of all the continents, showed an absolute loss.

Percentage share of the different continents.
1913 1924
Europe 61.4 51.7
Asia 11.4 15.1
North America 13.0 17.6
Central and South America 7.6 8.4
Africa 4.0 4.1
Oceania 2.4 3.1

Europe had had, from 1871 to 1880, about seven-tenths of the total trade of the world. After 1880 it retained something over six-tenths of a trade which was rapidly growing in all continents. Between 1913 and 1924 its commerce grew in nominal but shrank in actual value, and at the latter date it had to its credit but fivetenths of the whole. "Trade is passing from the Atlantic to the Pacific." That is the closing sentence of the League's latest Memorandum on Balance of Payments and Foreign Trade Balances, summarizing the changes in the currents of the world's trade. "The United States and India now buy less from Europe and more from Asia; China and Japan buy less from Europe and more from North America; Australia less from Europe and more from both North America and Japan." Europe has declined in importance, in purchases as well as in sales. How much of the change will be permanent it is impossible as yet to say; Europe is not the only continent subject to internal convulsion.

The above figures testify to the position of extraordinary importance which Europe has held and still holds in international trade. Two qualifications should be made regarding it. In the first place, the larger part of the trade of the European states was with each other; in the second place, most of it was carried on by a group of countries comprising but a small part of the continent.

Internal and with other continents, in percentage of total.
Imports Exports Total
1913 1924 1913 1924 1913 1924
Internal 59.4 54.9 68.7 65.4 64.1 60.4
Asia 10.2 8.3 9.6 9.8 10.0 9.1
North America 14.8 18.0 6.7 8.2 11.2 13.9
Central and South America 8.3 9.1 6.5 5.9 7.5 7.9
Africa 3.7 4.8 5.1 6.0 4.4 5.4
Oceania 3.0 3.5 2.4 3.1 2.7 3.3

Before the war the countries of Europe bought from their neighbors in that continent considerably more than half of the goods which they imported, and sold their neighbors over two-thirds of the goods which they exported. The war resulted in a considerable change in the proportions. Forced to economize in their purchases, and clinging to the best customers, the countries of Europe traded relatively less with each other, relatively more with the outside world. This was true of Europe as a whole and of every individual country in Europe of which we have comparable statistics for the years 1913 and 1924. Nevertheless, even in 1924 the internal trade of Europe was more important than its trade with all the rest of the world put together. It exceeded four-fold in value the trade with the continent next in importance, North America.

Comparing Europe with its nearest commercial rival, the American continent north of Mexico, it is fair to ask whether the older continent would still retain the primacy if the trade of both were measured in the same way, if the internal trade of Europe were left out of account, or if the internal trade of America were brought into the account. The question can readily be answered under the first supposition. The trade of Europe with other continents was in 1913 in round billions of dollars 9, while that of the United States and Canada was 5; in 1924 the corresponding figures were 12 and 9. The events of the war period left Europe still at the head, in distant trade, but with the gap between it and North America diminished.

If we include the internal trade of the two continents the comparison is fair only if we recognize that the European frontiers, which provide commercial statistics, are also great barriers to exchange and that no one can tell what the trade of Europe would be if it were as free to move as it is in North America. Taking conditions as they are, and choosing for comparison not the whole North American continent but that part of it, slightly smaller than Europe in area, comprised within the borders of the United States, we have every reason to believe that the trade among the States ranks higher in value than the trade among the European countries.

A second qualification is necessary to a right understanding of the part played by Europe in the world's commerce. Europe is the collective name for countries which vary immensely in their stages of development. The northwestern part has an advanced capitalistic organization, with specialized manufactures and an active intercourse with other parts of the world. Proceeding south and east one enters countries whose development has been retarded for generations, and still further to the east countries which are centuries behindhand. To speak of all Europe as contemporary is an anachronism. The countries of the Balkan peninsula which have only recently been released from Turkish rule, or the eastern countries where serfdom with all its medieval accompaniments flourished less than a century ago, are further removed in a commercial sense from countries bordering the North Sea than are some parts of distant continents.

The figures of Table III show how largely the commerce of Europe was concentrated in a few leading countries. The figures are based upon the values of imports and exports combined.

A. Percentage share in the trade of Europe, total and internal.
Total Internal
1913 1924 1913 1924
United Kingdom 23 29 15 19
France 12 15 11 14
Germany 20 13 20 13
Netherlands 11 5 13 6
Belgium 6 5 7 6
Italy 5 5 5 5
-- -- -- --
  Total, six countries 77 71 71 62

B. Percentage share in the trade of Europe with other continents.
North Central and
Asia America South America Africa Oceania
1913 1924 1913 1924 1913 1924 1913 1924 1913 1924
United Kingdom 39 50 38 41 33 42 37 44 64 74
France 11 14 10 13 14 16 30 35 9 9
Germany 17 13 22 13 25 15 16 8 15 7
Netherlands 13 5 9 4 5 5 3 2 1 1
Belgium 4 3 4 4 8 6 4 3 7 3
Italy 4 5 6 7 6 7 5 3 1 4
-- -- -- -- -- -- -- -- -- --
  Total, six countries. 88 91 88 82 91 91 94 95 96 97

The six countries listed in the table shared among them nearly three-quarters of the total trade of Europe, and had a still larger portion of its distant trade. Of countries not on the list there are two which in 1913 had a right to places above Italy: Russia with a share of nearly 6 percent, and Austria-Hungary with over 5 percent. The list, even when restricted to these eight countries, is too long to be treated in a single article, and I shall omit from consideration the countries presenting problems which are less interesting (Netherlands, Belgium), or problems which in a brief treatment are unmanageable (Germany, Russia).

Two characteristics of British trade give it a place by itself. The first is its absolute value. It amounted in 1913 to nearly onequarter (23 percent) of the total trade of the continent; in 1924 it considerably exceeded one-quarter (29 percent). At the earlier date Germany was a somewhat threatening rival; at the later date France, the country next in rank, had a commerce (taking decimals into account) amounting to less than half that of the British. In the second place, British trade differed from that of the other countries in quality. It was composed in larger part of trade with other continents, while most of the trade of other European countries began and ended in the continent of Europe. In 1913 only 40 percent of British trade was European; in 1924 the proportion was 38 percent. Of the countries next in order of commercial importance, France, Germany, and Italy showed a trade restricted to the European continent to the extent of about 60 percent; other countries were in the 60's and 70's, and about half of the states of Europe were in the 80's and 90's.

If British trade has more than held its own, compared with that of Europe in general, it has done so largely because it is so widespread. It has had some share in the commercial prosperity of other continents. Its position is much less satisfactory when it is compared not with the contracted trade of Europe but with the expanding trade of other continents, and particularly when the share of imports and of exports composing it is analyzed. Allowing for price changes, England was buying more from other countries in 1924 than in 1913, but was actually selling less at the later date. The export trade which had been steadily growing in the decade before the war had shrunk so that its volume in 1924 was only about four-fifths of the volume which it had attained just before the war, and was much less than half of what it would have been if the former rate of growth had been maintained.

The vital importance of the export trade to Britain, as the means by which the country buys the necessary supplies of food and raw materials, has led to a careful study of the situation,[ii] in which its difficulties are analyzed. Some part of the loss of the British export trade is due to the diminished purchasing power of people impoverished by the war (in central and eastern Europe), or by unsettled political conditions and lack of an outlet for their products (India, China, Mexico). During the war and the years immediately following, some peoples who used to buy English goods were forced to find other sources of supply, and British producers now find former markets occupied by competitors. It is significant that while the British export trade, with allowance for price changes, had fallen in 1923 about 20 percent below its volume in 1913, the export trade of the United States had risen about 20 percent and American exports of manufactures had increased nearly 50 percent. More serious than either of these factors in the loss of British markets is the tendency of peoples who formerly bought of England to supply their own needs for manufactures. War conditions necessitated or encouraged the establishment of factories to supply the home market; intensified national feeling has approved the maintenance of the home industries. Spindles and looms have increased in number on the Continent, in India, China, Japan, and in some of the South American countries; but the Lancashire cotton industry has been working short time. Similarly, Australia has sought to develop a woolen manufacture, and British India passed an act in 1924 for the protection of a home industry in steel.

One feature of the British report of 1925 which is of the greatest interest and significance is the statement that tariff barriers were a less serious obstacle to British trade in 1924 than in 1914. The increase in specific duties, reduced as well as can be to an average, has not been in general greater than the rise in prices; in the case of the textiles, a class in which Britain is particularly interested, it has been considerably less. An independent estimate of the British Board of Trade confirms the view that the incidence of customs tariffs on British exports, measured ad valorem, actually declined in the course of the period. This general statement is based on the statistics of those countries, mostly outside of Europe, in which British exports were largest, and does not of course deny the burden of the tariff in the case of individual countries; it does not refer to the prohibitions and restrictions of the war period, of which many were still in force; it may not, and probably will not, hold true of the future.

In foreign markets, in which Britain must face unaided the competition of established rivals like the United States and Japan (with the threat of German competition to come), and must overcome the resistance of newly founded home industries, the salvation of the British export trade appears to depend upon a heightened efficiency of production which will win a market in spite of obstacles. Britain must specialize still further, abandoning the simpler processes to other peoples, relying upon superior technique in the production of mechanical equipment for the manufacturer, and of articles of superior quality for the consumer. It is significant that the branch of the English cotton industry which has best maintained its position in these hard times has been that working on the long-stapled Egyptian cotton, turning out a finer product and demanding superior skill.

In the particular year 1924 France occupied the second place among the European states in the value of its commerce. It had lost that position to Germany before the war, and was to sink again to the third place in 1925, as German commerce revived. The process of repairing the material damage in the invaded districts had been completed so far as regarded industrial plant. The capacity of the reconstructed sugar factories was greater in 1924 than it had been in 1913. The coal mines which had been wrecked had been restored and had been supplied with mechanical equipment superior to that formerly in use. Outside the invaded districts many new factories had been built, and the recovery of Alsace-Lorraine added large resources in raw materials and highly organized industries. Disorder in the finances, attended by a depreciation of the franc, served for the moment, at least, to stimulate production and to extend the export trade.

France had a larger proportion of its commerce with outside continents than any other European country except Britain, and made up a part of what it lost in the impoverishment of Europe by the expansion of its trade with North America and Africa. In 1913 11 percent of French trade was with Africa; in 1924 the proportion had risen to 13 percent. And though larger, Britain's commerce with that continent did not represent so large a proportion of her total foreign trade.

Another characteristic of French commerce which contributed to maintain its volume after the war is the fact that French trade in Europe was largely confined to the western part of the continent. One quarter of it, in round measure, was carried on with Britain, somewhat less than a quarter with Germany, considerably more than a quarter with the other states bordering on its frontiers: Belgium, Switzerland, Italy and Spain. France, therefore, had less at stake in central and eastern Europe, where the effects of the war on commerce were most felt. The effect of the war was to reduce this part of French trade still further, to reduce the share of the trade with Germany, and to enhance the importance of the trade with other neighbors and with Britain.

French exports before the war were distinguished by their aesthetic rather than their practical appeal. They often had qualities of art and taste which won a market even when the industry from which they came was backward, measured by mechanical efficiency. Goods of this kind will always have a market, but may find it difficult to force a large market in a period of economic depression. The French are deeply concerned, and with good reason, over the effect of the British silk duties of 1925, which threaten the most important outlet of one of their principal industries. Manufactures of a more practical kind which grew up during the war have still to be tested in a field of active competition. France took the place of Germany in the supply of iron and steel to Switzerland, but there are grounds to doubt whether the French metallurgical industry, which developed so rapidly during the period of Germany's decadence, can hold its own in the foreign market in normal times.

Of the larger European countries Italy showed the greatest commercial progress in the war period. In 1913 it ranked eighth in the value of its foreign trade; in 1924 it stood fifth. Of course Russia and Austria-Hungary have disappeared from the list, but even so the change has some significance; and a change in the quality of Italian trade has still more significance.

Excess of imports (--), or of exports (+), in million lire*
Average 1909-13 1923 1924 1925
Food and animals --44 --2,385 --788 --1,571
Raw materials --958 --5,723 --6,714 --8,955
Partly manufactured --54 +383 +112 --621
Manufactures --149 +1,621 +2,320 +3,232
  * Quoted from Report of the Association of Italian Corporations in Economic Review of the
Foreign Press, July 23, 1926. Official statistics of Italian commerce are very meagre.

The absolute figures of this table are not comparable except as account is taken of the rise in prices, between five- and six-fold, due to inflation. The indication of a change in the relative importance of different kinds of imports and exports, even if these figures exaggerate the change, is supported by information from other sources. The land devoted to the production of cereals was diminished in this period by about a million acres; the product per acre in Italy has always been low, measured by the European standard; and the country has now to obtain a considerable part of its food from abroad. There has been an increase, less marked, in the imports of raw materials. The most striking change is the increase in the export of manufactures, which has reversed the balance prevailing just before the war, and which seems to have transformed Italy definitely into an industrial state.

The silk industry contributes, in raw material and finished goods, nearly a quarter of the total exports. For generations the families of farmers in northern Italy have devoted themselves to raising silk worms, and have acquired the experience which is of peculiar importance in this industry; the government has taken pains to spread the knowledge due to scientists like Pasteur; the product has grown in quantity and has so improved in quality that eggs are now exported even to China and Japan. In the manufacture of the finished goods the industry was furthered by the laming of the power of competitors during the war, and is assisted by the low wage scale prevailing in Italian industry. Real wages have risen, it is true, since the pre-war period, and the working hours, formerly inordinately long, have been reduced, but Italian labor, allowing even for its relative inefficiency, is still cheap. Hydro-electric plants supply the textile industry with power at a cost roughly comparable to the cost of steam power in other countries.

There is some ground for the fear expressed by H. G. Wells that Italy will become the industrial slum of Europe, keeping its place in foreign markets by exploiting a depressed people at home. Italian manufacturers are forced to seek a market abroad because their own people are too poor to buy their products. It is characteristic that Italy, which stands sixth among countries in the production of automobiles, and fifth in the export trade, stands first in the proportion of the product which is exported; Italian manufacturers sell only about one quarter of their cars at home. Italy needs a Henry Ford more than a Mussolini.

On the other hand it is but fair to recognize the technical skill which has contributed to the development of this and other Italian manufactures. The artificial silk industry, a characteristic product of modern technique, has developed with great rapidity in the peninsula and has proved its ability to hold its own in neutral markets like British India. Statistics are lacking for an accurate analysis of Italian trade relations with other countries, but apparently the Italian manufacturer has been most successful in placing his wares in the countries of the Balkan peninsula and the Levant. Albania presents an example of commercial dependence on Italy which, so far as I can note, is surpassed in Europe only by the dependence of Ireland on Britain. Three-fourths of the imports of Albania in 1924 came from Italy; over half of its exports went to that country.

The flow of goods in Europe, which was interrupted by the war and which has since the war been subject to so many disturbing influences, is still fluctuating; even to measure it is often difficult, and to foretell its future development is impossible. The troubled course of Italian politics makes a judgment of the economic conditions and prospects of that country particularly difficult. One item of information is available which gives a pretty definite measure of the increased economic activity of the country. Comparing the periods 1913-14 and 1924-25, and stating figures in round billions, the passenger service of the Italian railroads, measured in passenger-kilometers, grew from 5 to 8, while the freight service, measured in ton-kilometers, grew from 7 to 12. Making allowance for the extension of mileage in acquired territory, the increase is still remarkable. There may be a future decline from the higher figures, but it seems hardly probable that there can be a complete relapse.

One of the most impressive results of the war was the dissolution of the empire of Austria-Hungary, ranking second in area among the states of Europe, and the division of its territory among four new states and three former neighbors. To many observers the event has seemed a calamity; they view it as a reversion from civilization and describe it by the vague but certainly invidious term, the "Balkanization of Europe." If man were purely a commercial animal, and if civilization could be measured in bare terms of commercial area, their view is certainly justified. Trade among the peoples of the old empire is impeded by new frontiers, and is diminished in quantity. That it will necessarily continue so diminished, or that commercial benefits may not ultimately issue from a different political grouping, are assumptions still unproved.

In any event the importance of the matter must not be exaggerated. Austria-Hungary, in spite of its great area and population, ranked seventh among the states of Europe in foreign commerce, and accounted for little more than one-twentieth (5.2 percent) of the total trade of the continent. Three-quarters of its trade began and ended in Europe, and of its European trade a remarkably high proportion -- over two-fifths -- was carried on with one country, Germany.

It is impossible to determine accurately the effect of the war and of the regrouping which followed it on the commerce of the peoples of the old monarchy, but the figures of Table VI provide some grounds for judgment. This table includes only four states of the seven among which Austria-Hungary was divided, omitting the considerable territories given to Poland, Rumania and Italy; and by including Serbia it counts some territory that was outside the old frontiers, but this is of small importance as the total commerce of Serbia in 1913 amounted to only 36 millions.

In round millions of dollars the total commerce of Austria-Hungary in 1913 was 1,319. The total commerce of Czechoslovakia, Austria, Hungary and Jugoslavia in 1924 was 2,223. A little more than a third of this latter total consisted of trade among the states named, which would have counted as internal trade in 1913 and which must be subtracted, leaving a net total in 1924 of 1,466. There should be subtracted, further, the trade of the four states named with other parts of the old monarchy that are now included in foreign countries, i.e. Galicia, Transylvania and the territories annexed by Italy. But as the external trade of these regions would have to be added again to get the present total of external trade of the area formerly known as Austria-Hungary, it seems safe to conclude that in nominal value the foreign trade of this area was larger in 1924 than it had been in 1913. If we allow for a rise of one half in the price level, we see that between 1913 and 1924 the volume of trade almost certainly shrank; but, on the other hand, it must have amounted in the latter year to at least two-thirds or more of its former volume. If this estimate is safe, the foreign trade of the territories included in the old monarchy fared but little worse, comparing 1913 and 1924, than did the foreign trade of Europe as a whole.

More serious, without question, has been the decline of trade which passed freely within the bounds of the great state of Austria-Hungary, and which must now traverse the frontiers of independent states. Again, however, there is danger of exaggeration; however important to the countries concerned, the matter is distinctly not one of the major problems in the reconstruction of Europe. Illustrative material is presented in Tables V and VI. The first covers several years and includes all except Italy of the countries which inherited parts of the Dual Monarchy. The other is restricted to the year 1924 and to the four countries which composed the core of the old empire. Manifestly the scope of the first table is too broad, of the second too narrow, to serve for a comparison of conditions today with those prevailing before the war; but the two set limits between which the truth must be sought.

Percentage of total trade with other states named.
Imports Exports
1922 1923 1924 1922 1923 1924
Czechoslovakia 21 19 24 41 37 40
Austria 45 47 49 51 47 47
Hungary 66 69 66 77 72 74
Jugoslavia 55 50 45 37 42 45
Poland 18 15 20 33 29 27
Rumania 45 43 .. 38 31 ..

The figures in the horizontal rows show such fluctuations as one would expect in the unsettled conditions of the time, but appear sufficiently consistent to warrant our making some generalization. Poland has a relatively small commercial interest in the other Succession States. About 10 percent of its total trade is with Austria. With the other countries of the table the proportion is less, and with the agricultural countries, Hungary and Jugoslavia, it is negligible. On the other hand, the concentration of Rumania's commercial interests in the Succession States is surprising. Before the war Rumania bought only about a quarter of its imports from Austria-Hungary, and sold a much smaller part of its exports to the peoples of that country. There is a slight indication in the figures that the relative importance to Rumania of trade with the other Succession States is declining; this will be borne out, I should judge, by the development in the future. The resumption of trade relations with Germany, once of great importance, has been hindered by political issues which are in process of settlement; and the trade of Rumania with the more distant states of northwestern Europe is likely to extend at the expense of commerce with nearer neighbors.

A discussion of the commercial relations of the other Succession States is best based on a table from which Poland and Rumania are excluded. They fall evidently into two classes. Czechoslovakia and Austria are industrial countries, requiring a considerable volume of trade to maintain their organization, and dealing with many customers. Hungary and Jugoslavia are agricultural countries, much more nearly self-sufficient, and carrying on a trade more restricted both in quantity and in scope.

Total and internal, 1924, in millions of dollars.
Total Imports from Total Exports to
Trade states named Percent Trade states named Percent
Czechoslovakia 469 75 16 502 162 32
Austria 486 187 38 278 83 30
Hungary 143 75 53 117 78 66
Jugoslavia 106 45 43 122 52 42
----- --- ----- ---
  Total 1,204 382 1,019 375

Before the war the lands subject to the Hungarian crown carried on slightly over 70 percent of their trade with lands in the Austrian half of the monarchy. After the war the smaller Hungary carried on over 50 percent of its trade with the two countries Czechoslovakia and Austria. The territorial changes have been such that it is impossible to make an accurate comparison, but it is safe to say that the partition has not affected either the volume or the direction of trade so seriously as many supposed it would. Of countries entirely outside the old monarchy, Germany alone carries on a considerable trade with the new Hungary.

Jugoslavia, like Hungary an importer of manufactures and an exporter of food stuffs and raw materials, resembles Hungary in the direction of its trade. About a quarter of the total has been carried on with Austria, considerably less with Czechoslovakia. Trade with Hungary and with the countries of the Balkans has been noticeably small. These countries are so nearly alike in the stage of economic development that exchange relations are not particularly profitable. The feature of greatest interest in the commercial relations of Jugoslavia is the importance of the trade with Italy. In spite of the political differences between the two countries they have maintained pretty steadily a trade amounting to one-fifth of the total of Jugoslavia; in the year 1925 it exceeded in value Jugoslavia's trade with Austria.

Of the Succession States, Austria is generally acknowledged to occupy the weakest economic position. Lacking food stuffs sufficient for her population, lacking coal and other important raw materials, forced to pay for these necessary imports by the sale of industrial products, and deprived of the free market which the Dual Monarchy formerly afforded, Austria is indeed in a pitiful situation. That the country had not yet reached commercial equilibrium is evidenced by the considerable excess of imports in 1924. It must inevitably pass through a long and painful period of reorganization. But it has at any rate persisted through the most trying period, in which special restrictions on the movement of wares were common in Central Europe, and in which disordered currencies interfered most seriously with the establishment of regular commercial relations. Faced by considerable tariffs in the other Succession States (on metal wares, textiles and other exports), Austria itself has had to frame a tariff for bargaining purposes and has been able to obtain in the past few years some alleviation of the foreign duties.

The question of union with Germany is likely to persist, but on other grounds than that of a common commercial interest. In 1924 only 15 percent of Austrian imports were from Germany and only 13 percent of exports went there. The trade is still less important from the German standpoint; of German imports in 1924 less than 2 percent came from Austria, less than 5 percent of the exports went there. The alternative, a customs union with other Succession States, appears in some aspects more practicable, but would have to overcome nationalistic opposition.

Czechoslovakia stands by itself among the Succession States in the value of its trade and in the wide distribution of its commercial interests. It has a remarkable variety and abundance of mineral resources, including coal; it has fertile land and an advanced system of agriculture; it has an industrial organization comparable to that of the great states of northwestern Europe and able, long before the war, to market its products in distant countries. It trades, to a moderate amount, with all the other Succession States, above all with Austria, to which its supply of coal is indispensable. Its more important customer, however, is Germany, more than a quarter of its total trade being carried on with that country. Alone among the Succession States it has maintained important commercial relations with the countries of northwestern Europe, and with outside continents. It has established the beginnings of a trade with Russia and the Far East. The commercial position of Czechoslovakia is assured; the question is only how fast and how far its commerce will extend.

The commercial situation resulting from the partition of Austria-Hungary is so complex that it has to be presented in detail or not at all. To accord a similarly extended treatment to other parts of Europe is impracticable. But some light on changes in countries not yet considered is thrown by Table VII.

Total trade, in millions of dollars, and percentage of total trade of Europe.*
1913 1924
Value Percent Europe Value Percent Europe
Denmark 379 702
Sweden 446 713
Norway 247 356
---- ----
  Total 1,072 4.3 1,771 6.0
Spain 456 914
Portugal 133 127
----- -----
  Total 589 2.4 1,041 3.5
Rumania 244 270
Greece 57 203
Bulgaria 54 76
Albania ... 1
---- ----
  Total 355 1.4 550 1.9
Russia 1,475 490
Finland 174 242
Poland ... 529
Latvia ... 82
Esthonia ... 41
Lithuania ... 48
----- -----
  Total 1,649 6.6 1,432 4.9
Germany 4,966 19.9 3,721 12.7
  * The figures of value in the table are not corrected to allow for the depreciation of gold; they
indicate the relative commercial importance of the countries at a given time, but are less significant
than the percentages for comparison of conditions before and after the war.

Measured by the percentage standard, the first three groups of countries (as it happens, all of them peninsular) gained in commercial importance as a result of the war; they would still show a gain if they were measured by the more exacting standard of their share not merely of European commerce but of the commerce of the whole world. But the conditions which stimulated the trade of the neutral countries were temporary. If the table were extended to later dates, we would see that the countries of the Scandinavian and Iberian peninsulas are not holding the position which the war made for them, and are likely to resume their former places. The prospects of the Balkan countries are more promising. The growth of Greek commerce is remarkable and is due only in part to territorial expansion; Rumania will almost certainly improve its commercial position in the near future.

As regards the Russian countries a warning may be permitted like that expressed in the case of Austria-Hungary: the seriousness of the situation is too often exaggerated. Russia has never taken a place in commerce according with its area and its population. It is instructive to compare the percentage of Russia's share in European commerce in 1913 with percentages of other countries and groups of countries at that date. The independent Baltic states have initiated a wholesome commercial development, with every prospect of contributing more to the world's economy than they would have been able to do under Russian rule. The commercial future of Poland is more doubtful. Manufactures had been stimulated in that country by Russian and German and Jewish influences; they were not national Polish products. Deprived of access to the protected Russian market, they have still to prove their competence in the field of open competition. Without them the country will have to rely for its exports on its agricultural and mineral resources and will decline a step in the volume and character of its foreign trade.

Even below Poland in commercial importance in 1924, far below such little countries as Denmark and present Austria, came the great area subject to the rule of the Soviet. The figures for 1925 show a change; the total trade of Soviet Russia in that year is estimated at 657 million dollars. The figures must be left to speak for themselves. Connected with them is one of the great problems of the world: the recovery, by commerce, of a hundred million people dominated by a small group at war with capitalism.

There remains the other great European problem, the reconstitution of German commerce. Without any attempt at explanation or prediction, I reproduce below the figures of German trade in recent years and before the war; they give the value corrected for changes in the price level and expressed in percentages based on the year 1913.

1913 1920 1921 1922 1923 1924 1925
Imports 100 37 53 59 45 63 84
Exports 100 37 44 61 53 51 65

This is not the record of a normal commercial patient, but a fever chart; the indications of convalescence are still too obscure to be interpreted by anyone but the specialist.

The continent of Europe, as a whole, will not regain the position which it held in international trade before the war. In a decade or so it will recover from the conflict, but it is too old to win back the ground lost. The future belongs to other continents, developing their resources with the vigor and elasticity of youth.

Inside of Europe, as regards the commercial position of the different states, the indications appear to me to favor on the whole a reversion to the former ranking rather than a revolution in it. Comparing figures of the trade of the several European states before and after the war, among all the changes (of which some of the more striking have been noticed in this article) the student is amazed by the stolid persistence with which the currents of trade tend to return to their old channels. Even when quantities and values vary widely the trade often shows an extraordinary fidelity to its old proportions. Reviewing these figures, the student is tempted to a theory of commercial determinism, -- a conviction that trade channels have been cut too deep to be altered even by the interruption of the Great War, and a suspicion that even the political forces involved in reparations and international debts will not avail to transform the general plan of commercial relations that used to exist in Europe.

[i] 1924 is the most recent year for which a tolerably complete collection of figures is available.

[ii] Survey of Overseas Markets, the first report of a Committee on Industry and Trade under the leadership of Sir Arthur Balfour, issued at London in 1925.

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  • CLIVE DAY, Professor of Economic History at Yale University, author of the "History of Commerce" and other works
  • More By Clive Day