Proceedings of the first Independence congress : held in the city of Manila, Philippine islands, February 22-26, 1930 / Published under the direction of Dean maximo M. Kalaw, executive secretary, University of the Philippines.

82 INDEPENDENCE CONGRESS PROCEEDINGS

Mr. Cornelio Balmaceda, of the Bureau of Commerce
and Industry, read the following paper which was the
last:
INDEPENDENCE AND THE TARIFF
By CORNELIO BALMACEDA
The tariff problem that arises as a necessary counterpart of
the question of Philippine independence hinges mainly on the
existing free trade with the United States. This reciprocal
arrangement underlies our present tariff system. It has influenced the course of our economic life during the last twenty
years to such an extent that its expected abolition in the event
of independence is naturally causing much grave concern.
That a serious economic shock would inevitably come with
the grant of independence, if the complete and immediate abolition of the present free trade would come with it, cannot be
doubted. Its immediate effects on most, if not all, phases of
our economic life would be far-reaching. Our sugar, coconut
oil, embroidery, and other important industries here would
suddenly lose the only prop that now supports them. A precipitous slump would therefore take place in our export trade,
and, deprived thus of our big source of national income, a severe
economic depression would necessarily set in. In the import
trade, a great disturbance would likewise be inevitable. Domestic importers of American goods who now predominate
in this trade would be suddenly compelled to seek new sources
of supply unless the old lines of American goods that they
are now handling could be successfully adjusted to the new
competition that they would have to meet.
That our trade with the United States would still continue,
however, after the abolition of free trade, is beyond dispute.
What is uncertain is how much of the present trade will remain,
and particularly what share we would continue to have of the
United States' purchases of such products as we now sell to her.
Our exports of hemp and copra would most likely be little
disturbed, as these two products now receive no special benefit
in the American market from the free trade, and are in great
and constant demand by American cordage and coconut oil