641.0031/77: Telegram
The Ambassador in the United Kingdom (Bingham) to the Secretary of State
[Received November 20—5:30 p.m.]
552. 1. I presented the Foreign Secretary today with a copy of the memorandum contained in your 406, November 16, 4 p.m.57 and at the same time made the suggested plea. All arrangements had been made to comply with the Department’s instruction “in company with” the Canadian High Commissioner; at the last moment his office telephoned the Embassy that “a question had arisen on a matter of procedure which made it impossible for Mr. Vincent Massey to keep the appointment.”
2. The Foreign Secretary referred to the West African tobacco question (Department’s 379, October 23, 7 p.m.58) and the Australian commercial policy question (Department’s 376, October 16, 3 p.m.59) and said he was not prepared to make a statement on the former at this time but he would like to assure me that no steps would be taken such as were apprehended without further consultation. As regards the latter he said that although the British Government greatly desired satisfactory relations on all matters between the United States and the component parts of the Empire, the Australian Commonwealth was entirely independent. However, the British Government was glad to use its good offices as far as was practicable; that he had taken up the matter with the representative of the Australian Government and that their position was that the United States had a large favorable balance of trade with Australia; that the Australian Government had sought to procure an agreement which would relieve this situation; that negotiations had not matured and that there seemed to be no inclination on the part of the United States Government to undertake them. Consequently the Australian Government had felt it necessary to impose the license restrictions now in existence. Therefore there was nothing more that the British Government could do in this connection.
3. At the same time Eden handed me a memorandum on British trade policy which is the reply to that based on your 824, September 3, 6 p.m. and which I am telegraphing in view of your 179, May 26, 4 p.m.:60
“The memorandum61 which Your Excellency left with me on the 19th September on the subject of the international trade situation [Page 701] and trade policies has been very carefully studied by myself and my colleagues. Shortly after that date our two Governments joined with the French Government in issuing the declaration of the 26 September62 which reasserted the conviction that it is of cardinal importance to improve the chances of maintaining peace by increasing international trade. It was a source of particular satisfaction to His Majesty’s Government in the United Kingdom to join in this way with the United States Government in making a declaration which made it clear yet again that the objective of our national policy is to restore international trade and to secure a lowering of trade barriers.
His Majesty’s Government warmly appreciate the fact that in recent years the United States Government by their policy of bilateral trade agreements have taken a step towards lowering the barriers to international trade which were constituted by the high protective tariffs which the United States Government had imposed. His Majesty’s Government are glad to recognize that the untiring and far-seeing efforts made by the Secretary of State to negotiate these trade agreements constitute a valuable practical contribution to the objectives which both Governments have in common.
His Majesty’s Government for their part feel entitled to claim that the bilateral agreements which they themselves have concluded also constitute a practical contribution to these same objectives. These trade agreements have served the double purpose of increasing directly trade between the United Kingdom and the countries concerned and of contributing to the lowering of barriers to international trade generally. The markets of the United Kingdom have, as the United States Government recognise, been kept open in very full measure to the products of other countries. The net imports of the United Kingdom in 1933 amounted to £626,000,000, in 1934 to £680,000,000, in 1935 to £702,000,000; while comparing the first 9 months of 1935 and 1936 they have increased from £499,000,000 to £562,000,000. The average imports into the United Kingdom to-day represent £15 per head of the population a figure which is 2½ times that of France, 3 times that of Germany, and nearly 5 times that of the United States.
The above figures provide in the opinion of His Majesty’s Government the correct background for an unprejudiced estimate of the policy followed in their recent trade agreements; and in this connection they would reiterate the statement made by the President of the Board of Trade in his speech in the House of Commons on the 15th July last that ‘our policy is founded on equality of opportunity for all nations and is qualified only by the duty of other nations to play their part in the same general scheme.’
In this connection His Majesty’s Government desire to emphasise one important consideration which has not perhaps received adequate recognition. Faced as they were in 1931 with an increasing adverse balance of merchandise trade and a greatly reduced balance of payments they decided to concentrate on a policy of encouraging exports and their trade and payments agreements have been directed to that end. This course appeared to them to be not only the most advantageous to this country but also to be free from the danger of causing [Page 702] the further dislocation and restriction of international trade which might have resulted from the adoption of a policy based mainly on the restriction of imports or on the progressive depreciation of sterling.
His Majesty’s Government fully agree with the United States Government that the immediate objectives of national importance which necessarily have to be taken into account in all trade negotiations must never be allowed to obscure the wider ultimate aims which both Governments have in common. The ‘rigid controls and nationalistic policies of other countries’ are as the United States Government recognise especially harmful to the United Kingdom to which foreign trade is more vital than to any other country. The aim of His Majesty’s Government has in all cases been to mitigate by mutual concessions the rigidity of such controls and thus to promote that liberalization of international trade which has been the constant aim of both Governments.”
In discussing his memorandum, I emphasized the distinction between the British and the American “bilateral” treaties and referred to the Prime Minister’s statement at the Lord Mayor’s banquet on November 9th63 and called his attention to the fact that his freer trade reference was sandwiched between those relating to the concluded Anglo-Italian64 and contemplated Anglo-Argentine specifically bilateral agreements and urged again the importance of the British Government taking a bold and broad view. Eden expressed himself as being personally in favor of going as far as possible in this direction and assured me that he would continue his efforts with renewed vigor.
4. The Foreign Secretary asked me especially to convey the grateful appreciation of his Government for the position we had taken in reference to the five C-class cruisers adding that he had made a statement to the Cabinet yesterday pointing out this generous and friendly action and had been authorized to express on behalf of his Government their appreciation.
- Foreign Relations, 1937, vol. ii, p. 185.↩
- post, p. 734.↩
- Post, p. 770.↩
- Telegram No. 179 not printed.↩
- See telegram No. 324, September 3, 6 p.m., to the Ambassador in the United Kingdom, p. 680.↩
- For correspondence regarding the Tripartite Financial Stabilization Agreement, see pp. 535 ff.↩
- The London Times, November 10, 1936, p. 21.↩
- Signed November 6, 1936, League of Nations Treaty Series, vol. clxxvii, p. 183.↩