SPECIAL REPORTS FOR FEDERAL TRADE COMMISSION. 217

here, but it is closely associated with the British-American Tobacco
Co. (Litd.), which is a large importer of American and other tobacco,
cigarettes, etc., and which was in the past closely allied to the American
 Tobacco Co.
For the most part the products manufactured in China are for
home consumption and do not enter into the export trade of the
country.
ey anlydired products do not compete to any great extent
with imported goods, except in the way of cotton yarns and cloth,
which find themselves more in competition with Japanese and Indian
yarns and cloth than with any other. With American products it
may be said that the China products in any way that they might compete
 would do so on the ground of lower cost, and there is no question
 in China at this time of tariff discriminations or the activities of
combinations.
The only instance of the competition of China manufactures with
American manufactures in the Far East—that is, Hongkong, Singapore,
 and other foreign colonial points—that has come to the notice
of this consulate general has been in the matter of wheat flour. The
exportation of foodstuffs from China is prohibited under the treaty
tariff. American flour has found a large and ready market for years
in Hongkong, Singapore, and other colonial possessions, practically
without serious competition. More recently the Chinese Government
is understood to have given limited permission to Chinese flour mills
for the exportation to “oversea Chinese,” under restriction, of
Chinese wheat flour, with the result that the lower cost of the Chinese
flour has worked with disastrous results on the American flour market
 in the Orient at the present time, especially considering the state
of the silver market and its effect upon the price of the American
flour.
Foreign combinations exporting into China—It is exceedingly
difficult to furnish information under this heading, on account of
the scant sources of information at this end. The foreign combinations
 do not show up in the trade of the country as conducted by the
foreign trading houses or hongs in China, which may or may not
be the representatives of combinations of manufacturers in foreign
countries.
That the foreign trading houses or commission houses in China
do represent combinations of manufacturers abroad may be the case
to some extent, but the exact combinations and the terms and conditions
 of such representation are impossible of being ascertained at
this end.
In China are found some of the largest foreign trading organizations
 in the world, as, for instance, the firm of Jardine, Matheson &amp;
Co. (Ltd.), British ; Arnhold, Karberg &amp; Co., German; Carlowitz &amp;
Co., German; and Mitsui &amp; Co. (Ltd.), Japanese, etc.
These firms do not confine their business to particular branches,
but are all embracing in their operations in the country. They
stand as importers and exporters in all departments and classes of
manufactures, maintaining large engineering staffs and showrooms,
large sales forces, branches in all important treaty ports in the
country, steamship lines—coastal, riverine, and foreign (either as
general managers or agents)—and they hold themselves out as
overnment, railway, mining, engineering, and general contractors,