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opinion that while indirect taxation by means of customs on the coast is an ideal way of raising revenue (especially when, as here, exports are limited to raw materials and imports consist wholly of manufactured goods), nevertheless, the principle of direct taxation, though it should be cautiously applied and should at first be very light, should not be wholly set aside in laying down the lines which are to govern the future development of the country. Northern Nigeria has no sea-board on which to collect custom dues, and, owing to its distance from the sea and consequent transport charges, it offers less attraction to trade (on which alone customs are levied) than the Southern Protectorates. Northern Nigeria has also to maintain a powerful military force and derives no revenue from trade spirits, the importation of which is entirely prohibited. Internal fiscal frontiers were abolished, when the Niger Company's territories were transferred to the Crown. The basis of taxation must depend largely on direct contributions, if the country is to pay its fair share of the general revenue. Such a system has been in operation from remote antiquity; and the first step towards raising a revenue by such means consisted in studying the existing systems, so that Government, when instituting its scheme, might act in harmony with the traditions of the country, and, while providing a revenue, should at the same time assure to the native chiefs a fair proportion of the proceeds, and introduce only such reforms as should simplify and cheapen the collection, regulate its incidence upon the people more fairly, and reduce as far as possible the opportunities for extortion and oppression. As the native chiefs have lost their income derived from slave raiding and from taxes on traders, it has become necessary to arrange for revenue, in another direction, in order to meet this loss and to secure their loyal services. This change has had the beneficial effect of bringing the British staff into close touch and relations alike with the peasantry and with the ruling classes. Thus the rulers learn to recognise that their interests are identical

with those of the administration and a close co-operation is established, while the peasantry look to the British officers as their guardians and protectors against irregular demands and oppression. The security afforded for life and property and the certainty that the amount fixed as payment will not be arbitrarily increased, are a blessing so great that the payment of a reasonable tax falls lightly on them, while the direct payment of each village through its own chief to the district head-man will gradually have the effect in practice of emancipating the greater part of the rural population from slavery, or serfdom, and promoting a sense of individual and communal responsibility to take the place of slavery, as the institution gradually expires. Moderate taxation seems to supply an incentive to industry and production, which is needed in a country where pressure of population does not exist, owing to the depopulation of large areas caused by former misrule, and where the fertility of the soil and the employment of women in manual labour leave the male population ample leisure when debarred from the "pass-time" of inter-tribal quarrels. In carrying out the scheme referred to under the Land Revenue Proclamation of 1904, the reports of the Residents have been satisfactory, but it is stated that an increase in the political staff is absolutely necessary to give proper effect to it, and thus to assure to the native chiefs the payment of such dues, which they cannot now collect for themselves, as will enable them to maintain their position, while assuring a growing revenue to the Government. This scheme has met with general approval and satisfaction.

The total number of slaves liberated during the year 1904 was 564. The constitution and working of the native courts, of which eighty had been established at the end of 1904, have made progress. The returns of the principal cases are submitted to the Residents, and are examined by the High Commissioner with the object of making sugges-. tions and promoting uniformity of sentences. The courts deal almost entirely with civil causes and petty criminal

cases.

Since the abolition of the punishment of mutilation and the Government requirements of decency and humanity in imprisonment the native tribunals have been deprived of their most effective punishments for serious crime. It appeared, moreover, to be advisable that the powers of each court should be limited until it had proved that former abuses had ceased. Increased confidence in the impartiality of the native courts appears to be shown by the people, in as much as there has been no complaint of unjust judgments, or of bribery. The High Commissioner hopes to be able to establish a school of law for the training of Mallams at Sokoto. The appointment of a native judge to review the sentences of all native courts would probably be of great value, and would, he thinks, give much satisfaction alike to the native Emirs and to the Alkalis as proving the intention of Government to uphold the dignity of the courts, and non-interference with the law of the Koran. The courts in Bornu have not proved very successful, and in pagan countries but little progress has yet been made.

The population of the various provinces is estimated to be 9,161,700. The proportion per square mile in some of the provinces is about three; in other provinces, such as Bassa, it is nearly 143.

In regard to trade, the institution of caravan tolls has enabled the administration to collect a quantity of detailed information as to the nature and quantity of articles carried by traders. At first the Government caravan tolls" in substitution of the exorbitant levies at every turn were levied on "down" caravans; but now they are levied both on "down" and "up" caravans. After careful inquiries from all the Residents, the High Commissioner has received from every province reassuring reports to the effect that the traders pay the dues most willingly, and welcome this system of tolls as a great relief from the exactions of the past, and the enforced delays. He is not satisfied with this form of taxation and hopes to be able to largely modify it, if not to abolish it, by merging it in the general tribute tax.

In order to supplement the grant-in-aid by some local revenue, direct taxation has been instituted. The levy amounts to nearly £34.500, being one-third of the local revenue. Trade is increasing rapidly.

The imports of local origin are chiefly (1) salt from the North and East (Asben and Manga); (2) natron from Damageram and the East; (3) cattle and horses from Sokoto and Bornu; (4) kolas from Ganja and Lagos; (5) antimony from the Benue. Imports of European origin are (1) from Tripoli, English cloth, majenta-coloured thread in great quantities, beads, sugar, scent, mirrors, needles, spices, pepper, burnooses, horse-trappings, and a large quantity of writing-paper; (2) from the South, English cloth, salt, German dyes, and Austrian beads. Exports to Europe are leather, ivory, and feathers (the two latter from Bornu; feathers also from Sokoto). The bulk goes to Tripoli. Skins cost 6d. in Kano and realize 2 francs in Tripoli.

Regarding "economics," the first serious attempt to develop the economic resources of the Protectorate was in the year 1904. The High Commissioner, along with Mr. Elliott, the forestry officer visited various regions and made minute inquiries. His conclusions are "that there are very valuable areas containing rubber, which are either untapped, or are being destroyed by injudicious methods; that many other commercial products exist, and demand development; and that the prospects of a great cotton industry are good, the soil admirably adapted to it, and its cultivation well understood by the people. On the vast and little cultivated, lacustrine plain on the shores of Chad there were cotton bushes of such enormous size, that Mr. Elliott pronounced their measurements as almost exceeding credibility." The acacia forests of Bornu yield the gum most valued in European markets, and it may be found possible to develop this product by improved means of transport. Samples of cotton from each province were sent early in 1905 to the British Cotton-Growing Associa

tion, and Mr. Hutton, an expert, writes: "I can say that the cotton appears to be of excellent quality, good long staple, and just the class we require in this country and which we are most short of, and there is no doubt that if we could develop trade in this class of cotton there would be a great future before Northern Nigeria."

With respect to minerals, it appears that limestone of excellent quality, suitable to mortar, which will replace the costly import of Portland cement for all masonry work, occurs in many districts bordering the Benue. The High Commissioner regards this discovery "as of the utmost importance, and second only to a discovery of coal in its value for the internal development of the Protectorate. The construction of bridges, culverts, and buildings of all kinds, will, by its means be greatly cheapened, and it is possible that its excavation, burning, and transport to the place where it may be required may become a native industry similar to that in natron, which is now so widely extended." The salt from the brine springs of Awe and elsewhere has been analyzed at the Imperial Institute, and it appears probable that a nearly pure salt could be prepared without difficulty. The present output is estimated at 277 tons per annum, obtained during the dry season only. The development of these springs is being investigated. Among the minerals obtained by the Survey may be mentioned: Magnetic iron-ore of excellent quality, galena containing some silver, and tin-bearing sands, all of which are being investigated with a view to determining their commercial value. The examination of the sands of certain rivers has revealed the fact that small quantities of monazite occur. This is a valuable mineral containing thorium, which is now in considerable demand at high prices. These deposits will also be thoroughly investigated. No new prospecting licenses have been granted during the year; but the Niger Company have proceeded with the thorough investigation of the tin deposits in the area, for which they hold an exclusive prospecting license.

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