500.C1112/34: Telegram

The Consul at Geneva (Gilbert) to the Secretary of State

373. 1. At the request of the French and British delegations the discussion of economic questions in the Second Committee24 will not begin before Friday. The Assembly is expected to close toward the end of next week.

2. I learn that the British are sounding out delegates respecting a resolution providing for a study of the question of access to raw materials. It is expected to provide judicious joint inquiry by the Economic and Financial Committees with the assistance of experts.

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3. Stoppani today gave me the following statement of his views of the situation:

“The very important operation of ‘alinement’ of the three more important continental countries has been done on the basis of a rapid and effective collaboration between Washington, Paris and London to which Holland and Switzerland joined themselves immediately.

It is not only the devaluation in itself but also the way in which it was made e.g. not merely by each nation individually with its own strength and its own weakness but as an international operation.

The problem of the moment, as I see it, is to keep up this method of plurilateral and collective action also for the second part of the program i.e. liberation of exchange control which is not applied by the countries in question but by others in a further stage of the operation which will have to be done later and which will also require international collaboration.

If the countries concerned, in particular countries with strong protectionist interests like France and Switzerland are now allowed simply to fall back on their own autonomous individual action I am afraid that there is very little prospect that devaluation [will] be followed by rapid and wide abolition of restrictions as would be necessary. Indeed I fear that if a change in import policy does not take place devaluation might be followed by such a rise in price as might give origin to very difficult situations and possibly social trouble, especially in France.

It is therefore of the utmost interest that in some way the plurilateral collaboration begun in the monetary field (in which not only the five countries are concerned but also the countries of the sterling and dollar block [blocs] are mute participants) should be continued in the commercial field. We must not therefore, after the Second Commission has adopted a nice resolution, let the people drift asunder.

If the United States Government could find it possible to express in some way this thought to the other Governments concerned, it would be at this moment, in my opinion, of a very great value for the economic recovery of the world and also to a very great extent for the pacification of Europe.”

  1. Meeting September 23–October 9.