In spite of the confusion in Russia of which the end is not 

 nearly in sight, trade with this desirable market for our articles has 

 increased still further; and although it is obviously necessary to exercise 

 caution in the commercial intercourse with a country which is in 

 such a deplorable critical state, we have yet found by experience 

 that there is no lack of firms well supported by capital and able 

 to pass through the present crisis as if it were a disease of a tem- 

 porary character. 



The trade with Italy, Switzerland, and Holland does not 

 give rise to any special remarks. 



The commercial intercourse with Spain unfortunately still suffers 

 from the effects of the alcohol-law which has been in force since 

 October I st , 1904, and which in the main secures to a few im- 

 portant manufacturers alone the monopoly of the brandy and liqueur 

 production, whilst it has crippled small industries. The alcohol-reform 

 bill promoted by the parties affected has unfortunately not yet become 

 realised, as owing to the continuous change of ministries the Government 

 has not sufficient leisure to take in hand such a reform with any 

 chance of success. During the last twelve months, no fewer than 

 four different cabinets took up the reins, and each party which came 

 into power again appointed fresh commissions for the purpose of 

 making a thorough study of the industries affected. In every instance 

 months passed by without any tangible results, and in the meantime, 

 the existing Government had again made room for a new one. The 

 present Spanish parliament has now other points on the order -of - 

 the-day; when these have been dealt with, the alcohol - reform bill 

 may perhaps come up for discussion in the course of January 1907 — 

 assuming, of course, that the existing Government has not by that 

 time been supplanted. 



The trade with the Balkan States and also with the Orient 

 proper was very brisk. It is satisfactory to note that also in those 

 countries the due appreciation of quality has made considerable pro- 

 gress, and that it is gradually recognised that certain firms are in 

 the habit of looking upon those districts as welcome markets for 

 inferior and "cheap" products. The relations with Roumania (which 

 country has this year been favoured with a rich harvest) are constantly 

 extending, whilst the sale of our products in Servia has suffered much 

 from the tariff- war between that country and Austria- Hungary, — a 

 dispute in the satisfactory settlement of which Germany, as a "most- 

 favoured" nation, naturally is greatly interested. 



The trade with the United States of America continued brisk, 

 and all symptoms point to a continuation of the favourable commercial 

 situation in this important market. The regrettable catastrophe of 

 the earthquake of San Francisco has had no real influence on business 



