Lot 65A987, Box 99
Minutes of a Meeting of the United States Delegation Staff, Geneva, Switzerland, July 18, 1947
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3. Sir Stafford Cripps.1 Mr. Wilcox informed the Delegation that two long conferences had been held by Mr. Clayton with Sir Stafford Cripps: one on Saturday morning, July 12; another on Monday morning, July 14. During the discussions with Sir Stafford, Mr. Clayton had at his side for technical advice, Mr. Wilcox, Mr. Brown, Mr. Hawkins, Mr. Beale, and certain other members of the United States Delegation when questions arose involving special subjects.
During the two sessions, a number of thorny problems were discussed that had arisen in connection with the general work of drafting the ITO Charter for submission to the World Trade Conference, [Page 965] and in connection with the negotiations between the United States and the United Kingdom on tariffs and trade. Sir Stafford Cripps’ attitude at Saturday morning’s session was marked by complete indifference bordering on open hostility toward the objectives of the Geneva Conference. His attitude manifested a complete reversal of the policy agreed to by the United Kingdom negotiators during the course of discussion which terminated in the conclusion of the Anglo-American loan agreement in 1945. Apparently, over the weekend the British reviewed the course the discussions had taken at Saturday morning’s session, and had reached the conclusion that their attitude toward cooperative effort to reduce and eliminate trade barriers was alienating the friendship of the United States from United Kingdom. Consequently, steps would have to be taken to repair the damage. As a result the session on Monday morning was marked by an atmosphere of cordiality, friendship, and cooperation. Immediately following the Monday morning session, Sir Stafford Cripps held a press conference, followed later by a radio broadcast in which he threw the full support of the United Kingdom behind the ITO Conference.
At the Monday morning session the United States obtained commitments from the U.K. to support the United States’ position on nearly all important points of differences which have arisen during the discussions on the Charter. One notable exception marred total victory. Sir Stafford Cripps continues to lean strongly in favor of amending the provisions of the ITO Charter to eliminate prior Organization approval to use quantitative restrictions in balance of payments difficulties.
When the question of Empire preferences was raised at the Saturday morning session Sir Stafford Cripps argued at great length, Mr. Wilcox said, that the United Kingdom is not in a position at this time to consider reduction or elimination of those preferences without the prior approval of the dominions and overseas possessions. In support of his arguments, Sir Stafford relied heavily upon the speech given in Parliament a short time ago by the Prime Minister of the United Kingdom in which the dominions were promised that no modification would be made in Empire preferences without the prior approval of the dominion or overseas possession affected. Furthermore, Sir Stafford pointed out, reduction or elimination of Empire preferences is not a matter that can be achieved over a short period of time. The use of Empire preferences has given British foreign traders market advantages in the dominions and overseas possessions which cannot be divested upon short notice. British foreign traders cannot compete in the absence of the market advantages obtained from Empire preferences until they have had sufficient time to change their approach to questions of production and production costs.
[Page 966]At the Monday morning session Sir Stafford Cripps was informed by Mr. Clayton that the United States, in view of economic conditions generally prevailing in the U.K., would not insist upon complete elimination at this time of all Empire preferences. However, there are certain preferences which must be reduced or eliminated. In the case of the others we would be willing to accept a commitment to reduce them gradually; a percentage each year so that by the end of a specified period of time the preferences would be completely eliminated.
Mr. Wilcox informed the United States Delegation that Mr. Clayton reminded Sir Stafford Cripps at the meeting on Saturday that the offers made by the U.K. to the United States in tariff negotiations, were inconsequential; in fact they amounted to nothing more than token offers. Sir Stafford was told bluntly that the United States expected the U.K. to improve substantially their offers to the United States in order to bring them more nearly in a quid pro quo relationship to the offers made by the United States to the United Kingdom. The offers made by the United Kingdom to the United States do not offer a basis for negotiation. Mr. Clayton pointed out that the United States had offered 50 percent reductions in our tariff duties on nearly all products of importance in the export trade of the United Kingdom, to the United States. In return, the U.K. had made practically no offers worth considering on products of importance in the export trade of the United States to the United Kingdom. In reply Sir Stafford said that the U.K. had gone as far as possible in its offers to the United States. He remarked that while it might be true that on a statistical basis the offers made by the U.K. to the United States were inconsequential, nevertheless, if the U.K. offers were reasonably considered from the point of view of the greater economic strength of the United States, and the tremendous increase in the volume of the foreign trade of the United States due to the war, the offers made by the U.K. to the United States compare favorably to those made by the United States to the United Kingdom. Sir Stafford noted that if the United States is dissatisfied with the offers received from the United Kingdom, and if the United States feels that the offers made by the United States to the United Kingdom are superior to those made by the United Kingdom to the United States the only way that he sees open to bring them into line with each other is for the United States to withdraw some of the offers made to the United Kingdom, and to withdraw the extent of concessions offered to the U.K. In fact, Sir Stafford invited the United States to do so.
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- President of the British Board of Trade.↩