The Key West Citizen Newspaper, April 5, 1934, Page 6

and growth of these-industries is depend- ent upon the same features that govern the fishing industry and the present small “industries should be encouraged along 7 with the major one. Key West is certain to be included in the ~system of airways of this coun become an important point in the system joining the parts of the Western Hemis- phere. In these days of aviation progress, no community can afford to neglect its opportunities along aviation lines. In the major development of Key West consider- ation should be given to the final location of an airport in its proper relation to the other activities of the community. The extension of the present wood work- ing facilities of Key West offers an oppor- tunity for the employment of a large num- ber of men. It is useless to transport lum- ber in the rough any further than neces- sary. Key West could be made a central market for the hard wood products of Central American and the West Indies The wood could be graded, sorted, sawed, split, dimensioned and finished for further shipment to fabricating establishments nearer the points of use, In the case of furniture marketed in Central America or the. West Indies, fabrication could be car- ried on in Key West. A considerable amount of boat building is carried on in Key West. It would be ad- “yantageous to consolidate these activities particularly in view of the increasng num- a a yachts that may be expected in Key Any increase in the commercial import- alice of the port will be accompanied by a demand for those industries that are inci- dental to ocean traffic. These include re- pair plants, ship chandleries, wholesale grocery establishments, and fuel plants. KEY WEST HARBOR The greatest physical asset of Key West is its harbor. Key West enjoys the dis- tinction of having the only natural deep water harbor. in south Florida. Practical- ly no money has ever been spent on the three major entrances to the south and only a relatively small amount of about one million dollars in deepening the northwest entrance, Above all, the harbor and all of the major entrances are self-maintain- and cannot be closed. In a section other natural ‘harbors do not exist and where artificial channels are subject to silting and to complete closure during high winds, the importance of the harbor of Key West cannot be over estimated. ~The outer reef lies about six miles south - of Key West. The main channel cuts through the reef with a depth of 30 feet and enters an indefinitely large anchorage area where the depth ranges from 35 to and will “40 feet. The 30-foot channel then ‘passes through an inner reef and enters another - large anchorage area having depths of 31 to 35 feet. From this area the channel passes along the western end of Key West carrying a natural minimum depth of 26 feet to-Man-of-War Harbor which is the logical area for port development. The Northwest channel leads from the western end of Key West to the northerly reef car- rying a present, depth of 18 feet. I am in- formed that this channel can be deepened to 24 feet for the small sum of $600,000. To develop a harbor approaching that of Key West would cost millions and its harbor is therefore an asset of inestimable value to Key West. COMMERCE OF KEY WEST The phrase “commercial development of Key West” is used repeatedly in this re- port and without knowledge of the facts the impression that this is an entirely new development may be gained. The fact is that Key West has been a commercial cen- ter of real importance in foreign trade for a century. Among the eleven ports in Florida that are involved in foreign trade, Key West stands first with a margin of 62 per cent over the port of next importance. The value of imports and exports at Key West is twice that of Tampa, three times that of Pensacola arid ten times that of iami. The following table. obtained through the courtesy of the Collector of Customs at Key West is a summary of the values of imports and exports for the year June 1, 1928, to May 31, 1929, for the entire state of Florida: PORT VALUE. PER CENT Key West $33,320,980 39.05 Jacksonville 20,672,089 24.10 Tampa 15,991,961 18.73 10,626,064 12.47 3,166,756 3.70 1,606,734 1.95 $85,274,534 100.00 In addition to the figure given for Key West there is an item of $2,560,008 for gvods forwarded in bond making a total amount of foreign trade of practically thirty-six million dollars for the year. The table given above contains the lat- est information available. It represents present conditions which are below normal on account of the temporary depression in Cuba. With the exception noted the fig- ures are the result of normal progress in commerce. That the progress of Key West in commercial lines is steady and on & good basis is indicated by the following table taken from an official publication “Port and Terminal Charges at United States Ports” compiled by the Corps of Six other ports” Engineers, U. S. Army and U. 8. Shippi Board: 4 ested FOREIGN DOMESTIC TOTAL YEAR Tons Tons Tons 1923 532,103 44,618 576,721 1924 564,507 38,392 602,899 1925 612,939 38,897 651,836 1926 775,538 62,841 838,479 1927 564,486 160,026 724,514 Through the representative of the U. S. Lighthouse service, I am informed that an average of 150 vessels per day pass imme- diately adjacent to Key West. The prob- lem presented is to encourage and increase the foreign commerce already flourishing in Key West as in no other port in Florida and to set up conditions which will make it financially advantageous for many addi- tional vessels to make Key West a terminal. TREND OF COMMERCE After centuries of supremacy, water transportation remains and has every prospect of remaining the principal means of handling world commerce. Its suprem- acy lies in its relative cheapness based up- on the production and maintenance of its highways without expense to the carrier. Hence the location of every great com- mercial center in direct communication with means of water transportation. For centuries the trend of world com- merce has been east and west due to the westward progress of civilization around the world. Contacts have now been estab- lished in all countries of the northern hem- isphere. Still progress must be made and more nearly complete commercial rela- tions must be established through the zones in the north and south directions. A study of present world conditions shows that there are three outstanding commer- cial centers all located in the northern hemisphere. One of these centers is made up of several nations but the other two are single nations. Rivalry and consequently friction must exist among these three groups as their commercial paths cross and conflict. Hence a trend toward north and south paths of commerce is the inevitable result of the present desire for world peace. Many things point to the existence of this trend of world commerce. South American trade now rivals that with Europe and it is a fact that trade between North and South America is_ increasing and under all reasonable circumstances must continue to develop. THEORY OF FREE PORTS Every independent nation has an inher- ent right to provide means for its own pro- tection and as an essential part of that pro- tection has the right to construct ships for the transportation of supplies. In other words, every nation should provide itself with that class of vessels known as a mer- chant marine. No nation can afford to have a merchant marine lying idle except in time of war and consequently must en- gage in commercial enterprises to secure a return upon its floating investment. Any theory or practice which deprives nations of the right to a merchant marine and ade- quate return thereon is fundamentally un- sound and conversely a theory or practice based upon such ‘rights and returns is sound. A nation having a merchant marine nat- urally uses its own vessels to carry its own commodities and is within its rights in re- quiring that practice or in making such financial arrangements as to make it advantageous to follow that practice. In the case of two. such nations engaged in trade, however, an unsound financial, condition arises owing to the fact that ships sail loaded from one nation to the other but must return unloaded. If the ships met at a common meeting point between the two countries and exchanged cargoes then each would have a paying voyage and there would be a saving in capital invest- ment and no waste. Such briefly is the theory. upon which the establishment of Free Ports is based, a Free Port being the name of the meeting place mentioned. The theory of free ports is sound in princi- ple and moreover sound in practice. Vari- ous nations have established free ports and one need only to point to their growth and the tremendous volume of business handled to assure himself of the practica- bility of handling commerce through this mechanism. One of the fundamentals of a Free Port is that it must be located in a country hav- ing stable banking and exchange mechan- ism so that a firm making shipment to such a port for further shipment can ob- tain payment upon the original delivery of the goods. Of course, any port in the United States fulfills this condition, As a corollary, however, and as an economic proposition, a Free Port should be located as far out on the route of trade as practi- cable providing it is still within the conti- nental limits of the United States and has rail communication with the remainder of the country. This condition is for the pur- pose of lengthening the haul from which the United States receives revenue. Some confusion exists in the United States as to the relation of Free Ports to the question of the tariff and there is ob- jection to the establishment of Free Ports on the basis that it is a step in the direc- tion of free trade. In fact the establish- ment of Free Ports has nothing to do with the imposition of duties upon goods brought to this Country from foreign lands. A Free Port is merely for the purpose of _FREE PORT AREA---KEY WEST. FLORIDA THURSDAY, APRIL 5, 1934. stimulating foreign commerce by provid- ing an intermediate point at which goods can be exchanged without customs formal- ity as to duties, bonds and rebates. Any foreign goods removed from the Free Port for consumption or use in the United States are subject to any duties that may be legally imposed. KEY WEST AS A FREE PORT An effort has been made in this report to explain very briefly the principles which govern the location of a Free Port. Key West has a harbor that is incompara- bly better than any other in southeastern United States, Strategically it is the Gibraltar of the Gulf. It has rail and high- way communication with all parts of the United States and existing steamship con- nections with Gulf, Atlantic, and foreign ports. It is the southeastern point of the United States and is the obyious meeting point of traffic in North, South and Cen- tral American trade. The history of Free Ports reveals the ‘fact that it is hazardous to predict just what lines of trade will develop to the greatest extent. However, the operation of a Free Port at Key West can best be illustrated by example. Assume a rather unfavorable case of a shipment of coffee from Brazil to New York for consumption near that City and a shipment of automo- biles and farm machinery manufactured near New’ York from that City to Rio for use near that City. Under normal condi- tions of world commerce, the coffee would be shipped by Brazilian line to New York and the automobiles and farm machinery by United States lines. Each ship would return empty under the theory that every nation must use its own lines for its prod- ucts. This practice is in every way unbusinesslike. Now assume the same cargoes and other conditions except that Key West has been developed as a Free Port. Then both vessels sail for Key West and after exchanging cargoes return loaded to their respective ports where duty is paid in the usual way. In this way ships make paying trips in both directions and are conse- quently able to reduce freight rates. The voyage consumes about half the time thus reducing the investment for the accom- plishment of a given result. If this simple example is modified first by assuming that the automobiles are manu- factured in the middle West and arrive in Key West by way of New Orleans, second by assuming that parts of the cargo of cof- fee are required for San Francisco, Chica- go and Liverpool, and third by extending the number of cargoes to cover the many items of trade among the nations of the Western Hemisphere, the value of a Free