611.5931/51

The Minister in Denmark ( Owen ) to the Secretary of State

No. 177

Sir: I have the honor to refer to the Department’s Instruction No. 66, dated May 7, 1934, regarding the question of a reciprocal trade agreement with Denmark.

May I respectfully call the attention of the Department to my previous despatches, and especially to my despatch No. 102 of January 23, 1934, under the heading “Proposed Change in Denmark’s Tariff Policy”.

I beg to point out the fact that Denmark, although a comparatively small country has been and might still be a valuable, discriminating and reliable market for American produce but that unless steps are taken immediately this market will be lost because of three circumstances:

  • First, the proposed alteration in Danish tariff regulations in the interest of the protection of new Danish industries which are being encouraged to commence operations;
  • Second, through the operation of reciprocal trade agreements already effected and in process of negotiation with other countries;
  • Third, through the increasingly severe operation of the already established Valuta Control Board which, in pursuing the policy of purchasing from those who purchase from Denmark, continues to drastically decrease American imports. I have gained the impression that it may be the policy of our Government to give first attention to the negotiation of trade agreements with those countries in which there was a comparatively uncomplicated trade situation. When I was a war nurse, we were frequently faced in hospital with the problem of slightly wounded whose cure was comparatively easy and the desperate cases which could only be saved by heroic remedies and self-sacrificial effort.

There is no doubt that Denmark offers a particular difficult problem but it is equally certain that the patient will not survive unless something is done speedily.

Believing that a review of the commodities which Denmark has imported to the United States in the past may be suggestive in relation to the present problem, certain tables are submitted herewith:3

Among the commodities of importance which Denmark exported to the United States for the year of 1929 were 0.2 percent of her total butter production, 1.1 percent of her cheese production, 13 percent of her total hides and skins exports, and 12 percent of her seed exports. Reference has been made to the above commodities since it has been proven that there is a market for them in the United States.

It will be observed that the United States imported at the same time a considerable quantity of the same commodities from various other countries, a portion of which imports could no doubt be shifted to Denmark without materially upsetting the trade relations between the other countries, if necessary by compensation of other commodities since Denmark is very limited in her range of exports.

In the case of butter during 1929 it will be noticed that whereas Denmark supplied the United States with 197,083 pounds New Zealand supplied approximately four times this amount, or 844,424 pounds.

The attached chart3 recently published by the United States Chamber of Commerce based upon official United States government figures shows that Denmark stands among the leading 24 world markets for American products, but in 55th place as a seller to America, and that New Zealand is not even ranked among the chief buyers. To import agricultural products into the United States is obviously a difficult matter having regard to our own agricultural interests, but it would [Page 127] appear that if agricultural imports are restricted from other countries it should be possible to increase importation from Denmark of a sufficient quantity to materially aid Denmark without upsetting domestic agricultural production. Our rapidly diminishing but very valuable Danish market, which took no less than 13.3 percent of her total 1929 imports from the United States is worth the required effort.

The adverse effect of Denmark’s present policy is shown by the enclosures on the operation of the Exchange Control Board,4 as for example in 1931 the ratio of imports and exports between the two countries was 1 to 27 in United States’ favor, but it has steadily been reduced since, to 1 to 10 in 1933, and the indications are that there will be a further substantial reduction in 1934.

In view of Denmark’s pressing necessity to expand her export markets and the activities of other countries in connection with trade agreements with her it is urged that steps be taken to consider the increase of Danish imports to the United States, preferably of butter and other agricultural products, which are so important to Denmark and which might serve as a basis for trade negotiations.

Respectfully yours,

Ruth Bryan Owen
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