providing another independent connection with our West African Colonies.
The African Connection.
About the same time (in 1901) the cable was laid fix)m Durban to Mauritius, and thence continued by an all-British route to Australia, thus furnishing another strategic route home from the Cape. Broadly speaking, therefore, South Africa is now possessed of four good routes to Britain, namely, two on the West Coast, one on the East Coast, and one viâ Australia.
Simultaneously with this large capital expenditure efforts have been made to reduce the rate to South Africa to the lowest possible figure. From its old figure of 8s. 11d. it has been reduced by successive stages to 2s. 6d. per word. Resort has been had in this case, as in that of India, to the system of 'standard revenue.' In other words, it having been decided that £300,000 was a fair return on the capital expended on African cables, it was settled that, subject to that receipt being realized from the messages, the rate should be reduced by successive stages to 2s. 6d. This latter figure is the actual rate. A subsidy was arranged at the same time, but this has not been operative since the last revision of the agreement in 1901.
My conclusions upon this part of the subject are as follows: (1) Originally the risks of joining up South Africa were so great, and the derivable profits so small, that the State had to help with subsidies. These subsidies, however, are soon expiring. (2) Then the famous gold boom began, and the expansion of traffic thus caused has enabled a splendid quadruplicate system to be built up, uniting South Africa with the outside world. (3) In the future, foreign competition from Germany and France may be expected on both sides of Africa, and, indeed, has already begun on the West Coast. (4) In the future also South Africa may enter, as already appears to be the case, upon a period of stagnation, as is the case with Australia. (5) In all the circumstances,
