Foreign Relations of the United States, 1952–1954, General: Economic and Political Matters, Volume I, Part 1

394.31/7–1353

Memorandum by the Deputy Assistant Secretary of State for Far Eastern Affairs (Johnson) to the Secretary of State

confidential

[Washington,] July 13, 1953.

• Subject:
• Necessity of United States Support in Order to Facilitate Japan’s Accession to the General Agreement on Tariffs and Trade (GATT)

Discussion

The Japanese Government is insistently asking our continuing support for Japan’s application for accession to GATT. To the Japanese, accession to GATT even on a temporary basis is of the utmost political importance. In addition the Japanese look forward to significant economic benefits from GATT membership, particularly commitments for most-favored-nation treatment which have so far been denied them by important trading nations, for example, the United Kingdom and British Commonwealth countries.

The Japanese have suggested full-scale multilateral tariff negotiations which would enable them to qualify for full membership in GATT. As alternatives they have suggested: (a) bilateral tariff negotiations or (b) temporary membership pending full-scale negotiations. The Japanese intend soon to put before the contracting parties to the GATT proposals for either bilateral negotiations or temporary membership. As a temporary member Japan would be brought within the GATT framework and would incur both benefits and obligations, pending later negotiations to determine the conditions under which Japan would accede to GATT as a full member.

We consider that either full-scale or bilateral tariff negotiations would be inconsistent with our commitment to the Congress not to use renewed authority under the Trade Agreements Act¹ for major tariff negotiations. On the other hand, the United States might support temporary membership for Japan if you agree that such action would be consistent with the statement with regard to Japan included in your testimony on May 4 before the House Ways and Means Committee (Tab A).²

In early 1953, largely through United States efforts, the longstanding opposition of the major GATT countries was sufficiently reduced so that they were willing to give serious consideration to non-discriminatory terms for Japan’s accession to GATT. It is doubtful, however, whether temporary membership for Japan would be acceptable to those countries since they have stated that, in their view, Japan should accede to GATT only as the result of multilateral tariff negotiations in which the United States and other contracting parties would participate fully and would make Worthwhile tariff concessions to each other as well as to Japan.

Regardless of the outcome, the withdrawal of United States support for Japan’s desire to accede to GATT would impair our ability to obtain Japan’s cooperation in such important projects as their defense measures and export security controls. We consider, therefore, that the United States should not discourage Japan from proposing temporary membership.

If Japan’s proposal for temporary membership is approved by the contracting parties, Japan incurs both obligations and benefits under the general rules embodied in the GATT. In addition the contracting parties would become obligated to extend to Japanese products, subject to the various escape provisions in the General Agreement, the tariff rates set forth in the schedules of concessions, in return for tariff concessions by Japan. In the case of the United States, existing concessions would be extended to Japan pursuant to the authority of the Trade Agreements Act (See Tab B),³ and at the appropriate time public notice of intention to negotiate with Japan would be issued as required by that Act.

No change would result in the present United States tariffs applicable to Japanese goods. The principal effect on the United States of temporary Japanese membership in GATT would be to give Japan the formal right to consultation with regard to United States tariff increases on commodities of interest to Japan. As a matter of policy, we do, however, consult with Japan on tariff matters relating to such products.

Recommendations

1. That you approve United States support of a formula for Japan’s temporary membership in GATT under which we and other countries would extend to Japan, in its own right, the present GATT concessions but would make no new tariff concessions.

2. That you authorize discussions of the foregoing recommendation with Congressional leaders, the White House, and interested United States Government agencies, after the Trade Agreements Act is renewed.

1. The Trade Agreements Extension Act of 1953 (Public Law 215), which was enacted on Aug. 7, 1953, extended the President’s powers under the Trade Agreements Act for one year ending June 12, 1954; for text, see 67 Stat. 472.
2. Not printed. The full text of the Secretary’s testimony is included in “Trade Agreements Extension Act of 1953,” Hearings on HR 4294, House of Representatives, Committee on Ways and Means, 83d Cong, 1st sess., Apr. 27–May 19, 1953.
3. Not printed.