Memorandum of Conversation, by the Chief of the Division of European Affairs (Moffat)

Mr. Keith Officer called this morning to say that, following our conversation on the 19th, Sir Ronald Lindsay, Ambassador E. and P., had telegraphed to Canberra. They were now in receipt of a reply, which he was giving me partly orally and partly in an aide-mémoire.16

Briefly, the Prime Minister said that he was much gratified that we were trying to reach a meeting of minds with him rather than adopt a completely rigid position. Before considering the suggestion [Page 129] reached by Lindsay and ourselves of a further exchange of notes, he wanted to put all his cards on the table and to explain exactly what they were doing in the intervening period of six weeks before the licensing system was completely abolished. They had yesterday issued a new list of items which were no longer restricted, leaving only a residue, the value of which from all countries, British and foreign, they estimated at only 200,000 pounds a year, or a maximum of 25,000 pounds during these six weeks. Of this they would, although they were not in a position to announce the fact, grant licenses to us on certain of the items. In one or two cases only, where the American product was alone competitive with the Australian product, they had given previous assurances to their manufacturers that licenses would not be issued to American imports pending the imposition of the new tariff rates. These were very few. In view of the foregoing, Mr. Lyons hoped that his explanation would in effect be the equivalent of the formula we had suggested, though if we still wished to go back to a formula he did not exclude consideration.

I told Mr. Officer that naturally we would have to study the situation further; that there were at least six or seven officials who had an immediate interest, but that no time would be lost in starting consideration. Mr. Officer said that he had been planning to leave for Canada on Tuesday, but in the circumstances he had postponed his trip.

P[ierrepont] M[offat]
  1. Infra.