The Department of State to the British Embassy

The Government of the United States assumes that the Government of Great Britain concurs fully with its view that economic recovery and those conditions of peace of which the world is so sadly in need cannot be achieved, and disaster averted, unless something more effective is done to reduce excessive barriers to international trade and to arrest and limit the increase in armaments.

Definite progress, despite many impediments, has been made in carrying forward a comprehensive and broad program undertaking to restore normal international trade relationships and thus secure peace and economic well-being. It has been confidently hoped that the Government of Great Britain would display a major interest in the prosecution of this broad program and that much of the great influence of the British Government and of the British Dominions would be exerted in support of this movement.

It is in these circumstances that the Government of the United States is regretfully forced to the conclusion that recent evidences of the commercial policy pursued by the British and Canadian Governments, culminating in a reported pending trade agreement between those two Governments,2 raises the question of whether the cumulative effect of such policy is not to obstruct and impede the broad program for economic disarmament that is underway and that is being carried forward with such effort by a number of the nations of the world. This unfortunate impression of obstruction comes likewise at a time when the forces of extreme economic nationalism, as well as of extreme nationalism of other characters, are in a position where they may further handicap and delay the efforts of the Government of the United States and of other powers in support of this movement.

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The Government of the United States realizes fully that the questions involved in world economic rehabilitation cannot be divorced from other questions underlying world recovery, upon the successful solution of which questions world peace and national security must in the last analysis depend. It had hoped to find a way in which the Governments of Great Britain and of the United States might appropriately cooperate to the attainment of these great ends, within the limits of their respective national policies. But it would not be possible for the Government of the United States at this juncture to refrain from making it clear in all candor, while in the most friendly fashion, that such possible cooperation on the part of the United States must necessarily be premised upon the positive understanding that the Government of Great Britain is in fact disposed to take part in a practical manner in advancing the cause of world peace by cooperating in turn with the United States in its endeavor to bring about the elimination of those restrictions which today are stifling legitimate international trade.

The Government of the United States recognizes fully that every government has the fullest right to adopt and to pursue such policies relating to peace and economic conditions as that government may desire. For that reason the Government of the United States would not desire to be understood as questioning in any sense the nature or the terms of agreements which may be negotiated between the British Government and the Government of one of the Dominions of the British Empire. It desires solely to express its deep concern because of the prejudicial effects which increased or renewed trade restrictions may have upon international economic rehabilitation, upon the cessation of armament building, and upon the cause of world peace.

  1. British Cmd. 5382: Trade Agreement between His Majesty’s Government in the United Kingdom and His Majesty’s Government in Canada. Ottawa. February 23, 1937.