The Ambassador in the United Kingdom (Kennedy) to the Secretary of State
[Received March 26—2:50 p.m.]
738. Your 1661, December 22, 6 p.m., and Embassy’s 248, January 26, 10 p.m. Following letter dated March 24 received from the Foreign Office:
“I must apologize for the delay which has occurred in replying to your letter of the 27th December last on the subject of the exclusion of Messrs. Rockwood and Company from the British West African cocoa control scheme. Unfortunately I have not until now been in a position to deal with the points you raised. The considerations put forward in your letter were, as a matter of fact, immediately brought to the attention [Page 129]of the Department concerned and I understand that the difficulties in the way of making any alterations in the scheme have been fully explained to Mr. Homer Fox70a by Mr. Melville of the Colonial Office.
It is hardly correct, I am informed, to say that the proposals of Messrs. Rockwood and Company were made as the result of direct encouragement from the Colonial Office. Mr. Singer71 who is, I think, what we would call managing director of the company, has from time to time sent the Colonial Office copies of his correspondence with West Africa in connection with his plan. No doubt in acknowledging these various letters interest has been expressed in what he was doing but nothing beyond that. It is true that, while Mr. Singer was in Lagos before the cocoa control scheme was proposed, the Governor of Nigeria gave him every facility for carrying out his investigations and laying his plans for direct buying. These plans were not however approved in principle either by the Nigerian Government or by the Colonial Office; indeed under peace time conditions when trade was free, it was not the business of the Government to approve plans made by a commercial organization.
It is regretted that the company incurred some expense in making investigations which, for the time being, must be regarded as fruitless.
No question of course has been raised as to the status or responsibility of Messrs. Rockwood and Company, who are recognized as one of the largest chocolate manufacturers in the United States, or as to their ability to finance cocoa purchases in West Africa.
I note that the reasons for limiting the operations of the export control scheme to established companies do not appear wholly convincing in Washington. The suggestion that limitation was decided on under pressure from the established firms is incorrect. Under the wide powers given to the Colonial Governments by the Defence Act it would have been possible for them to allocate quotas on any basis which they chose to adopt but clearly some equitable basis had to be found. The only satisfactory basis was that of a standstill arrangement, which would leave the various shippers, after control was removed, in relatively the same position as before the war. It follows that during the period of control, no new entrants could be admitted to the trade. The principle has been applied generally and Messrs. Rockwood and Company have not been the only prospective new entrants to be excluded. There have been many claims both from European and African organizations who have presented even stronger grounds than those presented on behalf of Messrs. Rockwood and Company. The same answer has been given to these applicants as has been given to the United States company.
The reference to a quota formerly set aside for German trading firms in British West Africa must I think be the outcome of a misapprehension. In the period before the war German trading firms in Nigeria purchased about 17% of the total crop. When the control scheme came into force naturally German firms were not included in quota purchasing arrangements. The whole crop was divided proportionately [Page 130]amongst other established shippers both European and African on the basis of their purchases of previous crops.
The marketing of the main crop in Nigeria is now I understand practically completed and sales to United States manufacturers both from Nigeria and from the Gold Coast have proved relatively satisfactory. These manufacturers have been able to purchase British West African cocoa on the same terms and conditions as other buyers and in the absence of any complaint from Messrs. Rockwood and Company or from any of the other manufacturers it is assumed that the Government purchase scheme has not imposed upon them any serious difficulties in obtaining their requirements of West African cocoa.”