It would be possible to relate numerous other instances of personal experiences, all of which would be of similar tenor to those herewith given. It is humiliating to an American to travel throughout the length and breadth of South America and see the trade which legitimately belongs to us slipping away to Europe, when some of our own factories in that line are idle because of lack of orders. It leads one to ask the questions: “What is the matter with the American business man? What is the matter with the American manufacturer?”
The South American field is an extensive one, and it is a discriminating one. The idea that anything is good enough for that continent has been exploded. Buenos Aires, for instance, is a live, hustling up-to-date metropolis. The people have money and they spend it freely. What they buy they want of the very best, and nothing is too good for them. It might also be added that nothing is too expensive for them, as they are used to paying high prices, and money seems to be of little moment when once the desire for the article exists. So it is not a cheap or a low-price market that awaits the American merchant.
Argentina is essentially British in her sympathies. That is but natural, for England owns her railroads, public improvements and government bonds. Almost two billion dollars of British gold is invested in that republic, and perhaps fifty thousand of her subjects dwell there. There is not a boat that sails for Buenos Aires from an English port which does not carry some young English boys to that city, who expect to enter commercial life there. It is only natural that this should create a preference for English-made goods, for the Englishman always carries his atmosphere with him as well as his ideas of taste and style. And yet German houses have aggressively entered this field in the past decade and have made terrific inroads on English trade. The Germans have studied the markets; they aim to cater to its demands; they grant the terms asked by the merchants, and do anything to secure the trade—and they generally get it.
One noticeable feature of the German commercial invasion is its imitation, and a desire to furnish “similar” articles at a cheaper price. As a prominent man told me: “Their goods are worth no more than you pay for them, and they are bound to lose out in the long run.” It is this commercial rivalry that has caused the intense feeling between Germany and England, for the German manufacturer has been somewhat unscrupulous in his methods. If a manufacturer in the United States or England has succeeded in evolving some new and valuable contrivance, it will not be long until a German imitation will be on the market, and bearing an English name. It is well known that the North American manufacturers have evolved the best and practically only successful typewriters, cash registers and computing machines. Within the last year or two, however, German imitations have appeared in all markets. The machines in some instances have such a wholly misleading name as “Columbia,” showing the plain intention of deception. In these lines their methods have had little effect. One can hardly go into an office anywhere in South America without seeing one or more typewriters with familiar labels, for a half dozen or more manufacturers are working in that field, and nearly every store has from one to a half dozen cash registers of one or two North American makes. “We are bringing them in by the shipload,” said an agent in Buenos Aires, who handled both lines, and there was not much exaggeration in the statement.
It is in the practical and useful things that the genius of the United States has been most manifest. A great undeveloped country rich in natural resources stirred the inventive genius of the people, and the result has been a continual increase in time-saving and labour-saving appliances of all kinds. These same articles are equally adapted to conditions all over South America. In some places these articles are known and appreciated; in others they are still unknown. No manufacturers have evolved farming machinery of all kinds so well adapted to conditions in South America as those of the United States.
American manufacturers look with longing eyes towards the Orient as a promising field for expansion. It will be many years before China, for instance, will be a great importer of manufactured goods, because of the extreme poverty of the people and the consequent low purchasing power of the masses. The imports of that country, with its teeming population of four hundred millions, for the past year were about $333,000,000, an average of less than one dollar per capita. It will be many years before that percentage will greatly increase, because the rise in the standard of wages will be very slow owing to the abundance of labourers. Furthermore, as soon as trade has once been established, the low wages will induce manufacturers to establish factories on Chinese soil so that the cost of production will be decreased. Japan is, and will always be, a formidable competitor in the Orient, because of her ingenuity and similarly low wage scale.
South America, on the other hand, is not and will not be for a long time, if ever, a manufacturing country. Brazil has encouraged some lines of manufactures, because of her extensive water power, but still is and will ever remain an importing nation. Argentina, Uruguay and Paraguay have little available water power and scarcely any coal. Chile, Peru and all the other republics of South America remain importing nations. In none of these countries, except Chile, has coal been found in large quantities, and millions upon millions of tons are imported each year from Europe and Australia. The matter of fuel alone will always deter manufacturing in South America.
Let us glance for a moment at the purchasing power of these republics. Argentina, although not so populous as the immense republic of Brazil, easily stands at the head of the list. During the year 1909 the total foreign trade of the Argentine Republic was valued at $700,106,623, of which $302,756,095 was imports. This was an average of almost $108.00 for each man, woman and child in the nation, and an importation of more than $46.00 per capita. Thus this one republic, with a population of less than seven million, imports almost as much as China with more than fifty times the population. In the last decade the imports of Argentina have increased one hundred and fifty-four per cent., an increase exceeded only by Canada. She now ranks thirteenth in total imports and sixth in per capita imports. Those nations, such as England and Holland, which exceed in per capita imports, are large importers of raw materials and not manufactured goods, as is the case with Argentina. Furthermore, the population of Argentina is increasing rapidly, both by natural increase and immigration. There are no idle men in the country, as every able bodied man seems to be able to secure employment. Wages are about as high as in the United States, and the cost of living higher. The people spend their money freely, and the importing houses do an immense business which is increasing each year.
Brazil will one day be one of the great powers of the world, for she contains within her borders the greatest amount of undeveloped, fertile land in the world. The United States, exclusive of Alaska and the island possessions, could be set inside the territorial limits of Brazil, and leave a state as large as Texas on the outside. The Brazilian government estimates the population at a little more than twenty million, but it would probably be better to place the number at eighteen million. Brazil has fostered some lines of industry, especially the manufacture of cotton goods, where water power is an invaluable asset, but most of the goods are imported. The purchasing power of the people is not as great as in Argentina, because there are several millions of negroes and Indians included in the population. The total imports for the year 1909 were $179,690,125. This would be at the rate of ten dollars per capita, or ten times that of China. In other words, the imports of Brazil, with her eighteen million population, is equal to that of half the Chinese Empire. If the coffee situation improves there will be a great increase in Brazilian imports, for many improvements are withheld in the coffee regions at the present time on that account.