811.20 (D) Regulations/3968a
The Under Secretary of State (Welles) to President Roosevelt 16
My Dear Mr. President: A few applications to license exports from the United States to Japan have been made under the Japanese [Page 847] freezing order. A few inquiries have been made regarding imports from Japan. For the time being, the Foreign Funds Control Committee is holding these applications without action. It seems desirable that the Committee and also the export control authorities be given instructions as to the policy which you desire it to follow. I submit for your consideration the following statement of policy.
1. Exports to Japan. Many categories of exports are already forbidden by the export control regulations. It is recommended that the Foreign Funds Control Committee deny all applications for:
All articles the exportation of which is now prohibited by the existing export controls and such of the following products (or grades or types) as are not already prohibited by those controls:
- Wood pulp;
- Metals and manufactures;
- Machinery and vehicles;
- Rubber and manufactures;
- Chemicals and related products except certain products such as some pharmaceutical preparations, et cetera, to be specified after further study.
The above list includes all commodities in which there is any substantial trade except cotton and petroleum products (the latter being dealt with below). In none of the items in the list is there any large export at present. Raw cotton exports have averaged about $600,000 per month in the first six months of 1941 as against slightly over $4,000,000 per month average in 1938.
It is recommended also that action similar to that outlined above be taken at once by the export control administration, so that its action may conform to action taken under the freezing order.
2. Imports from Japan. It is recommended that no licenses be granted for importation of silk or silk products. The military authorities inform me that they have no need for further silk imports. Should that situation alter, policy can be changed immediately to meet such an altered situation.
It is also recommended that purchase of gold from Japan be discontinued.
It is doubtful whether application will be made for any substantial imports from Japan other than silk. Should such applications be made, it is recommended that they be acted upon depending upon the estimated need for the products involved in the United States. Proceeds from such imports, if any, can be made available for the payment of such exports as are permitted.
3. Petroleum Products. It is recommended that action here issue from the export control authorities on the basis of national defense needs. The action recommended is the issuance of appropriate directives [Page 848] and the revocation of outstanding specific and general licenses to prohibit the exportation, except to the British Empire, the Western Hemisphere and to nations resisting aggression, of
Gasoline above a specified quality and beyond a specified quantity (normal 1935–36 amount);
Lubricating oils above a specified quality and beyond a specified quantity (normal 1935–36 amount);
Other petroleum products above a specified quality and beyond a specified amount (normal 1935–36 amount).
(Specifications to be such as will preclude shipment of gasoline or oils capable of use for aviation gasoline and the high grade raw stocks suitable for their manufacture.)
The Foreign Funds Control Committee will continue to hold without action applications relating to petroleum exports from the United States and subsequently grant licenses under the freezing order only in accordance with the policy to be initiated by export control.
Believe me [etc.]
- President Roosevelt approved the recommendations, with the notation: “SW OK. FDR”.↩