611.48N16/76: Telegram

The Chargé in the United Kingdom (Johnson) to the Secretary of State

2605. Department’s 1587, December 11, 7 p.m.70 Immediately upon receipt of the Department’s 1463, November 21, an officer of the Embassy discussed the subject matter informally but fully with the appropriate official of the Colonial Office. The reasons assigned for the decision to limit the operation of the Government cocoa control scheme to established companies were essentially the following:

1.
The full cooperation of the trade which was considered essential for the proper functioning of the control could be obtained only on condition that no new companies were permitted to participate.
2.
The only practicable basis for allocation of the controlled trade was past performance which it was claimed automatically excluded Rockwood and Company for the duration of the control.
3.
The policy of limiting participation in Government control schemes to existing trade channels was uniform in all controlled trades and to make an exception in the case of cocoa would probably lead to difficulties in other trades as well.
4.
There were other claimants including certain native groups and London brokers who were also eliminated from participation in the controlled trade and who would be more difficult to deal with if an exception were to be made for Rockwood or other American concern.

Regret was again expressed on behalf of the Colonial Office at the apparent necessity for excluding Rockwood from direct participation, especially in view of the encouragement given earlier to Rockwood’s proposals, and an impression was received that the principal reason for this exclusion was the Colonial Office view that the established companies would not cooperate in the proper functioning of the control scheme on any other basis.

It was intimated nevertheless that if the United States Government felt strongly in the matter it might be possible to give the situation [Page 125]further consideration. However as other Government departments including the Treasury and the Ministry of Food were now concerned it would not be practicable to deal with the question informally through the Colonial Office but that it would need to be taken up with the Foreign Office. This has accordingly been done and we are pressing for an early decision.

Johnson
  1. Not printed.