Office of the Historian

550.S1 Economic Commission/35: Telegram

The Chairman of the American Delegation (Hull) to the Acting Secretary of State

London, July 13, 1933—9 p.m.
[Received July 13—7:30 p.m.]

130. Department’s 125, July 10, noon. The subcommittee on sugar and the International Sugar Council have been continuing discussions with all countries regarding the international sugar agreement. Up to the present time the representatives of about 30 countries including Great Britain and France have agreed in principle to the idea of not increasing production for the next several years subject in some cases to final decision by their governments.

The scheme that has developed as a preliminary base of discussion is embodied in a draft that the Cuban delegation plans to present to the Economic Committee. This draft is subject to revision in all respects being merely a tentative base for discussion. It set forth the obligations which various countries are asked to take in brief summary as follows:

(a)
The present members of the Chadbourne scheme69 are pledged to retain membership and to carry out a revised scheme of export quotas for 5 years.
(b)
The United Kingdom would limit the amount of home-grown sugar assisted by subsidies to amounts which remain to be settled through the years 1937–38 and to limit the total quantity of sugar exported from the British Crown colonies to the following: First and second years of the convention 842,000 tons; third year 878,000; fourth year 914,000; fifth year 950,000. Australia up to August 1936 would limit exports to maximum annual production of 611,000 tons permissible under the Australian sugar agreement act of 1932. As regards the period therefrom to August 1938 the Australian Government agrees to consult with other interested parties. South Africa would accept maximum annual export any one year of 160,000 tons. Santo Domingo figure of export undetermined as yet. Russia undetermined. Haiti would accept maximum export of 10,000 tons per year.
(c)
France, Italy, Japan and Spain who presumably produce in their respective national territories or in their respective colonies sufficient for internal consumption but do not normally export, would undertake to limit production to home consumption and not to export.
(d)
Other parties not specifically named above would undertake [Page 717] for the first 2 years not to increase production above the quantity produced in any of the 2 preceding crop years. With respect to the succeeding 3 years they would undertake not to increase production by more than 3 percent each year.
(e)
The obligations of each country are still under discussion with the International Sugar Council and the signatories of the Chadbourne convention.

The idea suggested is that the American Government should undertake some obligation which is ordinarily visualized though this is, of course, not a decided point as the obligation not to increase production during the first 2 years and thereafter for 3 years only by small amounts. It would appear that the following specific questions arise for the American Government to decide:

1.
Is it in favor of a world agreement for the limitation of production such as is outlined above?
2.
Are the relative terms suggested above in general satisfactory?
3.
Can the American Government undertake a governmental commitment of the type suggested?
4.
Is it, in particular, in any position to undertake any governmental commitment regarding the production in the Philippines?
5.
In discussion with the representative of Java this morning the question was raised outside of the text of the agreement whether the American Government could undertake to limit Philippine production to the share allotted in the American market and the Philippine home market.

It seems to the delegation that nothing in the plan; that is being worked out is in conflict with the plan for the allocation of the American market that has been under consideration in Washington. Ferrara70 is deeply interested in trying to carry these discussions through successfully. The delegation has promised a reply by Monday if possible.

Hull
  1. The so-called Chadbourne Agreement, authored by Thomas L. Chadbourne (d. 1938), New York attorney, was signed at Brussels, May 9, 1931, by producers of chief European sugar exporting countries, Java, and Cuba. For text of agreement, see International Sugar Council, Memorandum on the Alms and Provisions of the International Sugar Agreement of 9th May, 1931, Annex I.↩
  2. Orestes Ferrara, Cuban Secretary of State for Foreign Affairs.↩