611.4731/142: Telegram

The Consul General at Sydney (Moffat) to the Secretary of State

Department’s telegram of March 6, 3 p.m. Gullett was obviously greatly disappointed by the tenor of the Department’s telegram. He hoped that our unfavorable answer was not the result of the proposals [Page 744] contained in the Australian note of June, 1934,5 which he definitely withdrew.

I found the members of the Government in Canberra increasingly worried by the present precarious position of Australia’s London funds and was assured by Gullett that such measures as may have to be taken in the near future to limit imports will be due primarily to financial and only secondarily to commercial reasons. In such a process our trade position is, of course, the most vulnerable, and in view of our refusal to negotiate at this time Gullett foresees that the Government may soon be forced to yield to growing political pressure and introduce measures artificially to restrict and possibly even to divert American trade. He recognizes that our program is the best designed to restore world trade but maintains that the long term considerations we advance cannot prevail against the immediate importance of keeping Australia’s financial credit intact.

Full memorandum [of] conversation by air mail via London.6

  1. See telegram of June 5, 1934, 4 p.m., from the Consul General at Sydney, Foreign Relations, 1934, vol. i, p. 841.
  2. Despatch No. 154, March 16, 1936; not printed.