COMPETITIVE CONDITIONS IN INTERNATIONAL TRADE. 75

(¢) In Montevideo: One of the important tramways was financed
by German capital and equipped with German machinery.
(d) In other parts of South America are syndicated power and
lighting companies owned by Italian, French, English, and German
groups, with the result that orders for machinery and supplies are
placed in the respective countries of the owners.
(e) In Hongkong and Shanghai: The tramways are English
owned, and orders for equipment are for the most part placed with
English manufacturers,
(f) In China: The Government railways have been largely
financed by capitalists of the principal European countries, with the
result that orders for materials have been placed with the nationals
of these countries, such disposition of the orders usually being a condition
 of the loans to the Chinese Government.
Another manufacturer states:
In the South American market we are greatly handicapped by the
fact that the gas business is largely in the hands of British and German
 syndicates. These gas companies generally do their buying
through the home offices, making it extremely difficult for American
manufacturers to compete.
A manufacturer of power transmission appliances, dealing directly
with their foreign customers and thus coming in actual contact with
the situation, says:
In several South American countries and in Mexico, English,
German, and American investments in industrial plants, railroads,
and public utilities, insure in a large measure orders for machinery
pnd plant equipment being being placed with the merchants or manufacturers
 of the country having the investment. For instance, the
investment of Chieago capital in packing houses in Buenos Aires
insures the installation of American machinery in these plants, while
houses controlled by English capital are equipped with English machinery.
 In Chile, American mining interests buy American machinery,
 often at a higher price than similar machinery could be
bought for in Europe. Our investments in Mexico, as much as our
proximity to that market, is the reason for our having the lion’s
share of the foreign trade of that country.
An immense amount of capital goes abroad in public loans. Such
loans are often spent unproductively, as in war; and when they are
productively employed, as in railroads or.other public works, the
control of the properties does not remain in the owners of the capital,
as in the shareholders of a corporation. In the less advanced countries,
 however, engineers for such public works are often brought
from the country where the capital is obtained; and that country
profits by their preferences, their knowledge of home products,
and their ignorance of the products of other countries. The certain
way to make trade profit from a public loan, however, is to introduce
 conditions in making it. This policy is well recognized in