856D.6176/496: Telegram

The Ambassador in the United Kingdom ( Kennedy ) to the Secretary of State

254. Department’s 107, March 12, 1 p.m., was embodied in a note presented on March 15. Report of discussion with the Foreign Office went forward under cover of despatch No. 90 March 25.9

Through Viles, following recommendations of subcommittee arising out of American note have been obtained in confidence:

“The subcommittee are certain that the Committee will desire to give the American proposals their most sympathetic consideration and will be anxious to meet the wishes of the American Government so far as that is possible without conflicting with the main principles of the regulation scheme. The subcommittee have considered the note with great care and they recommend that the suggestions therein contained should be dealt with as follows:

(1) No comments.

(2) Article 18 of the agreement should be altered as follows:

‘The International Rubber Regulation Committee shall be empowered to and shall within 1 month after the date of its first meeting arrange for the nomination of four persons representative of the consumers of rubber of whom two shall be representative of such consumers in America, and such representatives shall form a panel who will be invited to tender advice from time to time to the International Rubber Regulation Committee as to world stocks, the fixing and varying on the permissible exportable percentage of the basic quotas, new planting, replanting, and cognate matters affecting the interests of rubber consumers.’

These alterations would seem to meet the point taken by the American Government.

(3) It is suggested that to the preamble of the agreement after the words ‘and adjusting in an orderly manner supply to demand’ the words ‘while at the same time making available all the rubber that may be required’ might be added.

The subcommittee do not consider that this addition is necessary in view of the present wording of the preamble; but they do not think that there is any obligation to it.

(4) (a) It is suggested that two sentences should be added to article 17 (b) as a result of which the second sentence of this article would read as follows: [Page 935]

‘Such assistance shall include annual reports on the working of the regulation in the territory or group of territories and all necessary statistical information which it is administratively practicable to obtain, including information as to costs of production and administration shall grant ample facilities to duly accredited agents, et cetera.’

(4) (b) As regards this matter—the manner in which the cost data are interpreted—the Government of the United States of America appear to be misinformed. It is the cost to efficient producers to which the Committee directs its attention. The form in which the cost price data for Malaga and the N. E. I. are obtained (in groups of cost prices) enables the Committee to obtain a clear view of the position in this respect.

(5) The question whether a minimum stock should be held by estates (no such regulations are practicable for natives) was formerly considered by the renewal subcommittee; but, after full consideration such a provision was held to be administratively impracticable. Nothing in the present draft agreement precludes the formation of buffer stock; and article 3 (I) specifically provides machinery under which the agreement can be modified or amplified.

The suggestion to constitute a buffer stock will require most careful study, and the Committee will probably decline to take any quick decision on so important a proposal. Clearly it is entirely impracticable to introduce into the draft agreement any provisions dealing with this matter prior to the 29th March. (Viles has handed the subcommittee what it terms ‘the rough project of a scheme for the creation of a buffer stock.’)

(6) The renewal subcommittee formerly carefully considered the desirability of making planting rights transferable from one territory to another but came to the conclusion that undesirable international complications would result from any such decision. They felt also that the general assent of the governments could not be obtained to such a proposal.

(7) The subcommittee consider that the prohibition of the export of planting material to non-signatory countries is an essential element of the control scheme.

There is in fact an abundance of planting material available outside the controlled area; and if that material is of lower yielding capacity than the planting material obtainable inside the controlled area the subcommittee see no reason why the advantages which would be derived from the use of this latter material should be made available to territories which without any sacrifice on their part are benefitting at least as fully as the controlled areas from the operation of the control scheme. The subcommittee are unable to accept the view that the imposition of this restriction on the export of planting material in connection with a scheme of control is unfair or that serious and detrimental results may be anticipated from it.

The subcommittee believes that even apart from the existence of control schemes such prohibitions of the export of planting material of a special character have been widely imposed by different countries.”

Kennedy
  1. Not printed.