600.119/1806a: Telegram

The Acting Secretary of State to the Chargé in Great Britain ( Laughlin )

3354. For Sheldon [from War Trade Board]: No. 1815. Great pressure has been brought to bear upon the Board to facilitate to the fullest extent possible the exportation of cotton. This we desire to bring about. In this connection Nordvall24 has requested an increase in the Swedish cotton ration, to which request we are fully disposed to accede. Furthermore, we feel that the time has come to increase the rations of all commodities for the neutral countries of Europe to an extent sufficient to meet the economic and industrial needs of these countries. We wish you would present this proposal to the Allied Blockade Committee and urge upon them the importance of arranging, at an early date, for the approval and effectuation of this recommendation. If you find difficulty in securing the adoption of this entire principle, we are particularly desirous that steps should be taken at once to secure the approval of the Allied Blockade Committee to the increase of the cotton rations of all the Northern Neutrals as there is no need whatsoever, from our standpoint, of restricting exports of cotton, and the continuance of any limitation upon the export of this commodity is productive of a distinctly unfavorable effect in this country. Please reply at once as to when you will be able to advise us definitely of the approval of the increase of the cotton ration.

In addition to the foregoing suggested modifications of rations, we feel that it is extremely important that some steps be taken at once to simplify the present cumbrous machinery, which controls the issuance of licenses for exports from the United States to the Northern Neutrals.

Reference is made to your 1984, Embassy’s 4259, December 3.25 From this cablegram and others that we are receiving, it would appear to us that the A.B.C. are adhering too strictly to a maintenance of very farreaching control of commerce with the Northern Neutrals, a control which does not seem to us warranted under the new conditions. At the present time it requires approximately 5 weeks between the time an exporter in this country secures an order before he is assured by the receipt of an export license that he may close his contract. Under present conditions this is unjustifiable and productive of a great deal of unnecessary irritation. The present practice of referring applications to London is responsible for a great part [Page 751] of this long delay and we are anxious to modify immediately this procedure, so that export licenses may be issued without such reference. The procedure has never been wholly satisfactory, and, although we were willing to follow it during the period of hostilities as affording a desirable control, we think that now it can well be dispensed with. To bring this about we propose the following procedure:

No commodities will be permitted to be exported to the Northern Neutrals without an export license.
No licenses will be issued for exportation to any person upon the statutory or confidential lists which are in our possession.
We will no longer refer applications to London, except applications to export commodities with respect to which we have received from the A.B.C. a warning by cablegram that the ration has been or is nearly exhausted.
For statistical purposes, we will cable to you daily the particulars of all licenses which have been issued without reference to London.
The following procedure will be followed with respect to particular countries:
Denmark. The Chamber of Commerce or Merchants Guild should cable the import numbers and full particulars direct to Danish Commercial Office here, who will immediately advise us and we will issue licenses on receipt of applications, if the parties to transaction are satisfactory.
Norway. If applicant is willing to ship to an Association, we will not require that we be furnished with the import number. If the applicant wishes to ship to a private firm, then the Norwegian Finance Department must telegraph the number and details of the application approved to the Commercial Department of the Norwegian Legation here, from whom we will obtain particulars.
Holland. We will consign everything to the N.O.T.26 supervising of course the ultimate purchaser; and we will not require to be furnished with the number of the import certificate.
Sweden. All goods will be consigned to the appropriate Association for the account of the ultimate purchaser, and we will not require to be furnished with the number of the import certificate.
To the limited extent to which principles of conservation are still applicable, we will of course apply them.

The foregoing procedure appears to us to insure a control which is adequate under present conditions. Our daily cablegrams will furnish the statistical information necessary to avoid exceeding the rations and the existing control through the N.O.T. and other import associations will be maintained, although we will no longer require [Page 752] to be furnished in advance with the numbers of import certificates. The blockade should be adequately maintained by virtue of the existing agreements with the Northern Neutrals, particularly in view of the fact that the Baltic is now under Allied control. Enemy Trade restrictions will continue to be maintained through our examination into the character of the consignee.

Please secure as soon as possible the views of the Allied Blockade Committee with regard to this proposed modification of the existing machinery.

  1. A. R. Nordvall, Swedish special commercial commissioner at Washington.
  2. Not printed.
  3. Netherlands Oversea Trust.