611B.9417/224
Memorandum by Mr. Roy Veatch of the Office of the Economic Adviser
Before I had read the last paragraph of Mr. Turner’s memorandum of September 5, I called Mr. Yoshizawa on the telephone and asked if the measures indicated in the statement which he had handed to Mr. Sayre on September 5 had actually been put into operation or if the extension of the Association to cover exporters to Hong Kong had already taken place. In reply Mr. Yoshizawa said that it was his understanding that it had definitely been planned to extend the membership of the Exporters Association and to introduce the measures indicated if the agreement regarding shipments of Japanese cotton goods to the Philippines is to continue. Naturally the Association does not wish to complicate present machinery by taking these further steps if the American Government is of the opinion that the agreement should be abandoned. Hence these steps will not be taken until some response is received from the American Government with respect to the proposed action.
Mr. Yoshizawa did not give me the impression that it would be necessary for the United States to “accept” the proposed action. Neither at this time nor in an informal discussion the afternoon of September 8 did Mr. Yoshizawa give me the impression that continuance of voluntary control by the Japanese was contingent upon any statement by this Government that the proposed measures would settle all questions regarding the operation of the control arrangement for the second year, although it is possible, of course, that the Exporters Association will insist that after the proposed action has been taken, this Government should be agreeable to omitting transshipped goods from the statistics of Japanese goods arriving in the Philippines. Mr. Yoshizawa was strongly of the opinion, however, that the question of the application of the agreement to transshipped goods as well as to those shipped directly should not be pressed by this Government at the present time. It was his opinion that the Japanese exporters would not agree formally to the inclusion of such goods in the statistics but, on the other hand, he did not indicate that the exporters would insist upon the exclusion of these goods. He appeared to be of the opinion that the amounts of Japanese goods arriving in the Philippines probably would fall within the limits suggested by us, at least during the next few months, if we are willing to let the agreement run along. He believed that the Exporters Association had already taken steps to limit shipments during the present months so that there should not occur this fall such a concentration of arrivals of Japanese goods as caused us special concern last fall.