to the last lock, a tidal lock of twenty to thirty feet lift. Below this point the canal enters the upper portion of the Harbour of Brito, one mile and a half from the Pacific. Here a breakwater is to be constructed, enlarging and making more commodious the present harbour.

The minimum depth of the water is to be thirty feet. With the exception of the rock-cutting in the eastern and western divides, the canal will be at all points wide enough for two ships to travel in opposite directions. Through the artificial basins in Lake Nicaragua, and in the San Juan River, vessels can pass each other and navigate with entire freedom.

The estimate of the time required for constructing the canal is put at seven years. As regards the cost of construction, the original estimate by the chief engineer of the Company was £13,000,000, but an engineering Commission has since estimated the cost at £17,500,000. If interest be added to this amount, the total capital required may be placed at £20,000,000.

The prospects of a canal between the Atlantic and Pacific Oceans depend, in the first place, on its commercial utility, in shortening routes and saving cost of transhipment; and in the next place, on the probability of its being employed by ocean-traffic. On this latter branch of the question depends the financial outlook of the canal, and it is affected by more than geographical considerations. The incidence of tolls must play a great part. It is obvious that a canal which levied no tolls might be largely used, if the smallest saving were effected in length of transit; while a canal which, geographically speaking, was perfection itself, might drive away traffic by the heaviness of its tolls, or, if the balance of advantages were almost level, by levying any toll

at all. Then again, the competition of rival routes must be considered, and the possible tariff-war which might be waged by the Suez Canal and certainly would be initiated by the Pacific Railways across the United States. If rival canals were constructed, national preference for one or other route would inevitably come into play.

The table on the opposite page, issued by the Nicaragua Canal Company, of the distances saved by the construction of a canal across the isthmus, may be taken as substantially accurate.

This table, however, does not take into consideration the competition of the Suez Canal. For instance, the distance from New York to Hong Kong by Suez is 11,796 miles; by the proposed American canal it is 11,038 miles. The importance of this will be seen presently when we consider the probability of trade seeking the isthmus route.

The next element of trade-advantage to be considered is the saving effected by eliminating the cost of breaking bulk in transit. This, of course, would be considerable, but cannot be accurately estimated without considering what amount of trade is likely to seek the canal-route, what are to be the tolls levied, and the rival attractions of the Suez Canal and Pacific railways. The actual amount of trade carried by the Panama Railway as given in the STATESMAN'S YEAR Book for 1885 is £17,000,000.

As to the shortening of traderoutes, the advantages of the rival schemes of Panama and Nicaragua may be taken to be equal. Trade from the United States would no doubt find a slightly shorter route by Nicaragua; but on the other hand, the Panama route would geographically be more advantageous for the States of South America on both the Atlantic and Pacific coasts.

We now come to consider the

TABLE SHOWING DISTANCES IN MILES BETWEEN COMMERCIAL PORTS OF THE WORLD AND DISTANCES SAVED BY THE NICARAGUA CANAL.

Miles.

Miles.

New York to San Francisco

Miles.

14,840

Miles.

4,946

9,894 Liverpool to San Francisco

14,690

7,694

17,921

6,996

12,921

5,870

.

Acapulco

13,481

6,430

13,071

3,122

7,051

13,631

3,682

18,180

15, 201

11,038

Hong Kong

18,030 15,051

13,786

1,265

17,529 16,040

Melbourne

12,111

13,502 13,290 10,000

12,550 14,125 8,680

3,929

3,870

Callao

Sandwich Islands

10,539

6,449

14,230

4,090

10,689

3,701 6,988

Sandwich Islands

Guayaquil

14,080

11,471

3,053 8,418

Spain to Manilla

9,136

4,944

Valparaiso.

16,900 13,951

9,750

4,688 5,062

13,520

431

New Orleans to San Francisco

France to Tonquin

17,750 15,201

15,052

13,887

1,314

4,047 11,005

Hamburg to Mazatlan

Mazatlan

13,371

13,843

6,320

2,969 10,874

7,051

Fonseca

11,683

Callao.

Punta Arenas, Costa Rica 11,120

5,515

5,605

Valparaiso .

9,962

3,987

5,975

New York to Eastern Entrance of Nicaragua Canal, 2,021 miles.

San Francisco to Western Entrance of Nicaragua Canal, 2,776 miles.

Hamburg

5,219

Callao

Amsterdam

Havre

Cadiz

NOTE.-The distances have been measured by customary routes most convenient for sailing ships and slow freight steamers.

prospects of trade using the isthmus canal, were it constructed by either route, and were merely financial considerations to be regarded. On this receipts will depend, and the financial success of the canal as a private enterprise.

The Nicaragua Canal Company gives the following estimate.

From statistical records it appears that the number of ships trading from our Eastern ports and from Europe to the North and South Pacific was, in 1879, 2,647, with an aggregate tonnage of 2,671,886 tons. Eight years later, in 1887, statistics show the following facts:

Trade across the Isthmus of

pen

A searching criticism of this estimate of the Nicaragua Canal Company appeared last year in THE TIMES from the of Mr. G. E. Church, who, on the invitation of the chief of the United States Bureau of Statistics, studied the question in 1880 with the assistance of the staff of the Bureau. The writer found that in that year, crediting the canal with every vessel and cargo which might have made a saving of distance by using the canal, the result was 2,818 ships yearly, carrying 2,938,386 tons of cargo, valued at £48,362,000. The probable, as distinguished from the possible, number of ships using the canal was only 55 per cent. of the latter, amounting to 1,500 vessels yearly carrying 1,625,000 tons of cargo, valued at £32,136,000.

It was found that the commercial utility of the canal, with respect to the Atlantic and Gulf ports of the United States, would be practically limited to trade east of 110 degrees of longitude east of Greenwich (from New York to Hong Kong viâ Suez is 11,796 miles, and by the proposed American canal 11,238 miles); and that it would be probably utilised but little by vessels making voyages between the eastern seaboard of the United States and Australia, and between the same seaboard and Chili. It was also not doubted that almost the entire west coast trade of South America, from Callao south, would continue to use the Cape Horn route for its trade with Europe, as being more economical than the projected canal route, and, in the case of sailing ships, much more advantageous. For these reasons, deductions of 1,337 vessels, carrying 1,312,602 tons of cargo, were made from the possible to arrive at the probable traffic. This estimate appeared to receive confirmation by applying the same basis of calculation to the then traffic of the Suez Canal, which showed 6,312,742 tons of possible against 3,291,553 of actual traffic, the latter being 52 per cent. of the former. It was found that the proposed canal might have a possible traffic as follows:-Of United States commerce, 7.5 per cent.; of English commerce, 2.76 per cent. ; of French commerce, 1.53 per cent.; of the international commerce of the globe 3.00 per cent. For the purpose of argument, let us suppose

that the increase of commerce which would probably pass through an American canal will be double the above estimated quantity at the close of this century (say 3,252,000 tons), by which time one if not both of the canals may be completed. The canal toll on this tonnage, at the high rate of 8s. per ton, amounts to £1,300,000 gross income; of which, let us assume, 70 per cent., or £910,000, would be net profit, or 5 per cent. on £18,200,000.

In all ordinary enterprises it is the custom of the projectors to have an elaborate and even minute calculation made of probable income before venturing to solicit the aid of capital; but it is noticeable that, in the case of Panama and Nicaragua, the usual estimated traffic receipts are largely imaginary; six, eight, and even ten millions of tons per year have been put forward as a basis for finance; and little besides national glory, patriotism, sentiment, and élan have been enlisted as proofs of accuracy. If, for instance, the Panama works are to be continued, why not proceed in a businesslike way, appoint a perfectly independent commission of commercial men and experts to examine into the question of what portion of the world's commerce will in all probability make use of the canal? I am not aware that the promoters have ever caused such an independent examination of the problem to be made. With a proper staff it might be done with extreme accuracy in ninety days; but it should be absolutely uninfluenced by any consideration except a desire for the truth; and the truth would be a great boon, not only for the past shareholders, but for those whose contributions may be invited for the future. The Panama Company calculated that its canal would, the first year it was opened, have a traffic of 7,250,000 tons; but an analysis of the inflated data upon which this tonnage is based only shows how blindly the company plunged French capital into their Danaids' sieve. Strange to say, I find the promoters of the Nicaragua Canal not only using the same data, but swelling the tonnage to 8,159,150 tons.

The probability of European trade seeking the American isthmus-route has been taken as granted. But the enormous distance which separates manufacturing Europe from the canal on the Atlantic side, and the western exit of the canal from the east of Asia on the other side, renders the

probability somewhat indeterminate. The resemblance to the case of the Suez Canal is only superficial.

Does not the Isthmus of Panama exactly resemble Suez, inasmuch as it is a narrow strip of land connecting two grand continental divisions? Yes; but here, unfortunately, the comparison ends. To the westward of the Suez Canal, and almost at its gateway, are the manufacturing and trade industries of Europe; and eastward, within reach, hundreds of millions of Asiatic people exchanging their own products for European goods. Westward of the proposed American canal is the vast stretch of waters of the Pacific Ocean, over 6,000 miles wide; and eastward, between it and the activity and resources of Europe, the whole width of the Atlantic Ocean. In the case of the Suez it is land, populated and full of trade life, on either hand; but for Panama it is water, water, and interminable water as far as the influence of the canal can extend either east or west.

What then must an American interoceanic route principally depend upon? Must it not be the commerce of the United States plus such part of that of the west coast of South America as may be coaxed through it? Above three-fourths of the west coast foreign trade of South America is now carried on by sailing ships, as being the cheapest method of transport. It is a well-known fact that sailing vessels in approaching the bay of Panama almost invariably encounter prolonged calms, sometimes for weeks together. Again, after

leaving the canal a sailing ship would have to beat north and east against the current and trade winds in her effort to reach her European destination. Is it probable that under such circumstances a sailing craft would select this route and pay a canal toll for the privilege? If this statement be admitted as true, does it not determine that nearly the entire commerce of a Panama canal, and only to a less extent that of a Nicaragua canal, must be carried on by steamships?

We are forced, as a final main source of traffic, to look to the Pacific coast of North America, its trade with Europe and the Atlantic coast of the United States, and the eastern Asiatic trade of the latter. Much reliance is placed by the canal promoters upon the wheat trade of the Pacific coast with Europe-say, between 700,000 and 800,000 tons yearly. If it go in sailing vessels it might reach Liverpool cheaper vid Cape Horn, owing to prevailing winds and cur

rents; but let us credit it to a canal, and allow it will go by steamship, despite the canal-toll burden, which, however, may be offset in part by reduced freight. Let us add to this the large trade between the eastern and western sea-boards of the United States in illuminating oils, canned and dried fruits, wines, brandy, hops, and wool, and eliminate the competition of the Pacific Railways; then add the growth of new industries and commercial exchanges, and we shall find that if we give a Panama or Nicaragua canal a yearly traffic of 1,700,000 tons from these sources during the first year of its existence, it will be most liberal.

But it must not be forgotten that for much of this traffic there will be brave competitors the Pacific Railways. In 1869 the first one was completed. In that year the trade between New York and San Francisco, via Panama, was £14,000,000 value; in 1870 it was reduced to £3,800,000,

canal were constructed by French hands, it may be assumed that national preference would be equally divided between the Suez and the Panama routes, other conditions being equal. But if the Panama canal were finally abandoned, and the Nicaragua canal constructed by the United States, then the element of national rivalry would come into full play, and no trade capable of going by Suez would go by Nicaragua.

The prospects of a ship-canal at Panama or Nicaragua being constructed by private enterprise, by French or American capitalists, do not seem favourable. Any enter

taken the rail route across the continent.

In the traffic estimates of both Panama and Nicaragua too little notice is taken of the controlling influence of the Suez Canal. If a voyage between two ports be approximately the same distance via Suez or vid an American canal, which route would be preferred?

The competition of the railways both in the United States and in Canada must be of the greatest importance in determining the use of

an

isthmus-canal which depends on tolls for its support. In addition to the present conditions which render that opposition most formidable, one of the immediate future, not referred to by Mr. Church, is likely to play an important part. The inter-colonial conference of British Colonies has practically rendered certain the completion of a subsidised line of steamers from Australia to British Columbia.

Lastly, as influencing the probability of trade seeking one or other canal, there remain for consideration what may be described as non-financial motives. That Trade follows the

Flag is now admitted, and that national preferences for a national enterprise weigh even with traders is conclusively established. If a Panama

over £20,000,000 would have to face enormous difficulties, even were there no considerations other than the mere difficulty of getting the money together. But both in the case of Panama and Nicaragua there are other deterrents. In neither case is there any sure prospect of profit. Besides this, the whole Panama scheme has been discredited, to say the least of it, by the mismanagement and miscalculations which characterised that ill-fated project. The melancholy close of the great career of De Lesseps was only one of the results of a failure which spread financial calamity among millions of the French people, and seems to have effectually stopped the springs of further contributions to the bottomless pit of Panama. The Nicaragua project, from the point of view of the private investor, seems to have prospects hardly better. Almost equally with the Panama scheme it has shared the discredit arising from the failure of of that project. Special objections also exist calculated to deter the private investor. The organised opposition in the United States Congress on the part of the