Memorandum by the Chief of the Division of Trade Agreements (Hawkins)

Conversation: Mr. H. O. Chalkley, Commercial Counselor, British Embassy;
Mr. Henry Frank Heywood, Commercial Secretary, British Embassy;
Mr. Harry C. Hawkins.

Mr. Chalkley and Major Heywood called by appointment today to receive the answers to the questions concerning the proposed trade agreement which were presented on March 17, 1937. I gave them the attached statement34 explaining that it represented the best estimate which our experts in the trade agreements organization were able to make on the basis of the present status of our studies.

Mr. Chalkley read the answers to the questions and expressed gratification with them. The only question raised by him related to the second paragraph of the answer to question 4. I explained that the thought we were trying to convey was that, except for the list of products subject to the Ottawa agreements which has already been submitted, we do not specify any particular products, other than pork products, on which the negotiations would hinge. However, in view of the extent of the concessions which we would probably be in a position to make, improved treatment by the United Kingdom on an additional substantial list of products would be essential. I explained further that failure to grant a concession on any one of the products in such additional list probably would not cause a failure of the negotiations if another product or products could be substituted so that, on the whole, the list of concessions were substantially as long and of the same value as the list requested.

Mr. Chalkley then raised the question whether we felt that trade with the Crown Colonies should be dealt with in the negotiations or should figure in the exploratory discussions with a view to finding a basis. I told him that so far as we had considered this matter, we felt that trade with the Colonies should be dealt with in the proposed agreement at least by means of the general provisions, if not detailed schedules; that possibly the task of drawing up detailed schedules for each of the numerous Crown Colonies might, upon examination, be found impractical, in which case general provisions applicable to them might be worked out. In any case, we are concerned now with [Page 21] finding a basis for negotiations and this requires only that we reach agreement on questions on which negotiations might break down. Since both parties apparently feel that the Crown Colonies should be dealt with in the negotiations and since neither is able to envisage any insuperable difficulties to reaching an agreement in this field, the question might be left open for the time being. Mr. Chalkley agreed with this. I told him we would continue our study of the Colonial question with a view to formulating our views on the subject and would take the matter up with him later.

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